The Australian government has unveiled its plans to invest $1.8B (£0.9B) in the energy sector as a means to reduce carbon emissions, while keeping power prices low.
Published on 11 May, the 2021-22 Federal Budget reiterated the government’s commitment to maintain affordability, reliability, and security in the electricity system predominantly through new funding of $58.6M (£32.2M) to support key gas infrastructure projects, unlock new gas supply and empower customers.
Up to $215.4M (£118.4M) will support investment in new dispatchable generation and deliver affordable and reliable electricity. This includes up to $76.9M (£42.2M) to underwrite Portland Aluminium Smelter’s participation in the Reliability and Emergency Reserve Trader mechanism. A further $49.3M ($27.1M) has been allocated for battery and microgrid projects and $24.9M (£13.6M) to assist new gas generators become hydrogen ready, as well as $30M (£16.4M) for early works on Australian Industrial Power’s Port Kembla gas generator project.
In addition, $1.2B (£0.6B) will be spent to establish Australia at the forefront of low emissions technology innovation and commercialisation, including:
- $279.9M (£153.9M) to establish the below baseline crediting mechanism recommended by the King Review to support large industrial facilities to reduce energy consumption and emissions while improving productivity and international competitiveness.
- $26.4M (£14.5M) to help Australian businesses and supply chains to reduce energy costs through more energy efficient industrial equipment and business practices.
- $14.3M (£7.8M) to reduce costs and streamline the reporting requirements for businesses covered by the National Greenhouse and Energy Reporting Scheme.
Other measures include the creation of an Australian Climate Service from July 2021 that will provide advice on risks from climate change and a road map to inform planning for future infrastructure. The government also said it was refreshing its 2015 National Climate Resilience and Adaptation Strategy, to be released in the second half of 2021. The strategy will inform about an updated pathway for building the community and economic resilience to climate change.
Federal Minister for Energy and Emissions Reduction, Angus Taylor, said the Budget is supporting the government’s approach to energy policy and emissions reduction, setting Australia up for a post-COVID world:
“These initiatives will secure Australia’s recovery while also bolstering our position as a leader in the development of low emissions technologies, which are vital to achieving net zero emissions globally”