Australia is poised to be a major player in the clean energy transition thanks to the government's proposed A$23 billion (more than $15 billion) “Future Made in Australia” package, which includes tax incentives for renewable hydrogen projects.
The government's massive stimulus package aims to expand domestic manufacturing and accelerate the transition to a pollution-free future, with A$13.7 billion (around $9 billion) earmarked for subsidies for green hydrogen and the processing of 31 critical minerals, as reported by The Guardian.
According to ABC Australia, from 2027 the government will offer a 10% production tax credit to help ease the cost burden for companies in the critical minerals sector.
For green hydrogen, the government will subsidize companies for 10 years Aus$2 ($1.30) per kilogram of hydrogen once they start producing – the only condition is that they have to be an established business by 2030.
Additionally, IG Bank said it would set aside A$1.7 billion (about $1.2 billion) for an innovation fund, which will prioritise industries such as green metals, batteries and low-carbon liquid fuels.
In addition, IG Bank noted that A$134.2 million (about $89.2 million) will be allocated to worker training programs and A$519.1 million (about $344.8 million) will be set aside for a future drought fund.
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Solar energy is also getting a boost, with Australia's Solar Sunshot scheme set to invest up to AUD1 billion ($664.2 million) in solar manufacturing.
The funding will be allocated in stages over the next 10 years to support Australia's “biggest transformation since the industrial revolution”, as Treasurer Jim Chalmers said in his budget speech, according to The Guardian.
Chalmers called the package a “tremendous opportunity for Australia” but noted governments needed to be strategic about which projects they dedicated public investment to.
This ambitious stimulus package will help create jobs in the clean energy sector and support the Australian economy, advancing global climate goals and ushering in a healthier, safer future. It is similar to the US Inflation Beats Act, which provides thousands of dollars in tax breaks and credits for homeowners who install solar panels and other energy-efficient upgrades.
“Australian energy can power it, Australian resources can build it, Australian regions can drive it, Australian researchers can shape it and Australian workers can thrive in it,” Mr Chalmers told parliament, The Guardian reported.
“Our $22.7 billion [about $15 billion] Future 'Made in Australia' packages will help make Australia an integral part of the global economy.”
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