Law Firms in Australia Look to Energy Transition for Revenue Growth
Australia’s ambitious shift toward a low-carbon economy is proving to be a significant driver of revenue growth for law firms across the country, as reported in a recent analysis by Law.com. The nation’s commitment to reducing greenhouse gas emissions by 43% below 2005 levels by 2030 and achieving 82% renewable electricity by the same year has created a surge in demand for legal services in the renewable energy sector. This transition, underpinned by the Australian government’s Powering Australia plan, is reshaping the legal landscape, with firms positioning themselves to capitalize on opportunities in renewable energy projects, regulatory compliance, and dispute resolution.
The energy transition encompasses a wide range of activities, including the development of solar, wind, hydrogen, and energy storage projects, as well as the decommissioning of traditional fossil fuel infrastructure. Law firms such as Ashurst, DLA Piper, and Herbert Smith Freehills are at the forefront, leveraging their expertise to advise clients on complex transactions, project financing, and regulatory frameworks. For instance, DLA Piper has been recognized as the number one global renewable energy legal adviser by Inspiratia for 2021 and 2022, advising on high-profile projects like Fluence’s Mortlake Power Station battery and Grupo Cobra’s Central West Orana Renewable Energy Zone Transmission Network.
The Australian Financial Review’s Law Partnership Survey highlights that firms like HWL Ebsworth, MinterEllison, and Ashurst are experiencing robust growth, fueled by the return of deals and the rising tide of energy transition work. Ashurst, for example, reported that its energy and resources sector accounted for 23% of its total revenue in the 2023–24 financial year, with an 11% increase in its projects and energy transition business. This growth is attributed to the increasing complexity of renewable energy projects, which require specialized legal expertise in areas such as mergers and acquisitions, project development, and arbitration of cross-border disputes.
However, the sector faces challenges, particularly a shortage of lawyers with the specialized skills needed to handle the technical and regulatory intricacies of renewable energy projects. Young lawyers are increasingly drawn to the sector, motivated by its alignment with environmental and social governance (ESG) priorities, but firms report a lack of experienced professionals capable of navigating the nuanced legal landscape. This gap is prompting firms to invest in training and to recruit talent with deep industry knowledge to meet client demands.
The energy transition is also giving rise to new legal risks and disputes. According to Global Arbitration Review, issues such as design deficiencies, supply chain delays, and performance-related claims are becoming more common in renewable energy projects. Additionally, the rise of greenwashing litigation, exemplified by cases against companies like EnergyAustralia and Santos for misleading claims about their environmental impact, is creating new avenues for legal work. Ashurst, for instance, successfully defended EnergyAustralia in a landmark greenwashing case, highlighting the growing importance of compliance with environmental claims under the Australian Consumer Law.
Innovative financing models, such as portfolio financing, are further driving legal work. Macquarie Capital’s advisory role in the $1.2 billion portfolio financing of Fotowatio Renewable Ventures’ solar assets underscores the need for legal expertise in structuring complex financial arrangements. These deals require lawyers to address unique risks associated with large-scale renewable projects, enhancing project economics and flexibility.
As Australia accelerates its transition to a net-zero economy, law firms are poised to play a pivotal role. The combination of government incentives, private sector investment, and evolving regulatory frameworks is creating a fertile ground for legal services. Firms that can adapt to the sector’s rapid changes, invest in specialized talent, and navigate emerging legal risks will likely see sustained revenue growth in the years ahead.
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