Budget 2023: Australia steps up. To keep pace we need a giant leap forward

May 10, 2023

Australia can "power the world" with renewable energy and clean technology, but only if we raise our ambition towards becoming an export powerhouse.

Beyond Zero Emissions, a leading Australian think tank focussed on accelerating the shift towards a zero-emissions economy, has welcomed several measures announced in the 2023-24 Federal Budget and cautioned that Australia is still falling well short of the policies, funding and ambition required to become a "renewable energy superpower".

In delivering this year’s budget, Treasurer Jim Chalmers announced that “Australia’s biggest opportunity for growth and prosperity is the global shift to clean energy. By acting now, our resources, our researchers and our regions can help power the world.”

These words are welcome. We know, based upon our own research, that Australia has the unique opportunity to “power the world” by catalysing renewable energy, critical minerals and skilled workers to become a powerhouse of the global clean economy. What we need, to keep pace with historic commitments being made by our trading partners, are well-coordinated policies and large-scale investment to match the rhetoric.

CEO of Beyond Zero Emissions, Heidi Lee, says: “This Budget is a welcome step up. But to keep pace with governments in the United States, Europe, and Korea, who have contributes hundreds of billions to decarbonise the global economy, we need a giant leap forward.”

The 2023-24 Federal Budget contains a number of new commitments that begin to shape Australia’s future as a clean export powerhouse, including:

  • Net Zero Authority: $83.2 million to support workers through the transition
  • Hydrogen Headstart: $2 billion investment in renewable hydrogen production
  • Household Energy Upgrades Fund: $1.3 billion towards household electrification and energy efficiency, including $300 million for upgrades to social housing

Says Lee: “Each of these announcements demonstrate the government’s commitment to Australia becoming a ‘renewable energy superpower’. Support for workers, electrification and energy efficiency, investment in renewable hydrogen and the commercialisation of other clean technologies are all necessary and welcome steps.”

The budget also contains positive signs that the government is investing in critical industries for the clean economy, including $80.5 million towards the critical mineral sector to build diverse supply chains.

Lee: “As Beyond Zero Emissions’ Export Powerhouse report shows, by developing sustainably mined critical minerals, green steel, green aluminium, and renewable hydrogen industries, Australia’s clean exports industry could be worth $333 billion per year by 2050. But we need to make larger investments in these industries now.”

BZE is also encouraged by last night’s announcement of a $392 million Industry Growth Program to help Australian startups and small to medium enterprises (SMEs) to commercialise.

Lee: “The companies that we work with in the regions – homegrown heroes innovating for the clean economy – often have more opportunity accessing capital overseas so they are moving to places like the US, particularly since the passing of the Inflation Reduction Act. This Program shows the government is aware of this challenge and keen to act – now the challenge is to move further and faster.”

The global shift to the clean economy is a once-in-a-lifetime opportunity to, as the Treasurer tells us, “make Australia a renewable energy superpower, with strong strategic industries in global supply chains.” However, if we fail to match the ambition and funding contributed by other governments, our potential will remain unfulfilled.

Says Lee: “As BZE’s research shows, taking bold and decisive action now pays off many times over in the years ahead – in jobs, in investment and in creating strong regional communities. Australia’s future prosperity demands that we continue to challenge ourselves to think and act more boldly, so let’s get on with it.”

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