Australia plans to roll out a series of financial incentives aimed at bolstering investments in the domestic clean energy industry, as reported by Reuters on February 16. Prime Minister Anthony Albanese stated that the government needs to be a partner in the renewable energy sector, not just an observer. He also underscored the unprecedented investments the US, the EU, Japan, and Korea are making in their industrial bases. People familiar with the matter disclosed that the incentive package is likely to encompass a mix of subsidies and co-investment.

The incentive plan supplements existing policies designed to propel the growth of clean energy technology in Australia. In October 2022, the government established the National Reconstruction Fund (NRF) to allocate AUD15bn (USD9.8bn) for seven priority areas of the Australian economy, including investments in renewables and low-emission technologies. Last December, the government also made a commitment to fund renewable energy projects to ensure that 82% of power is generated from renewables by 2030. These initiatives came in response to the massive green subsidies introduced by America’s Inflation Reduction Act (IRA) and the EU’s Green Deal Industrial Plan, potentially luring green investments away from Australia. Last year, prominent investors, unions, and clean energy organizations called on the Australian government to shell out AUD100bn (USD65.4bn) to compete with the IRA, proposing an Australian Renewable Industry Package.

Sources:

https://www.reuters.com/business/energy/australia-set-join-global-clean-energy-subsidy-race-with-new-green-fund-afr-2024-02-16/

https://www.afr.com/politics/federal/think-big-pm-plans-cash-splash-on-green-fund-20240215-p5f53s

https://www.innovationaus.com/pm-we-can-go-toe-to-toe-with-inflation-reduction-act/