With $19.7 billion announced for the Future Made in Australia initiative, the 2024-25 federal budget is a good sign for the Hunter's economic diversification away from fossil fuels. This will enable the region to remain a global energy and cleantech hub. Beyond Zero Emissions (BZE) recognises the significant effort to drive action on the ground in industrial heartlands such as the Hunter.
But the true measure of the budget will be in how quickly these investments hit the ground and the detail of key policies.
This is the first federal budget to lay the foundations for a Renewable Energy Industrial Precinct (REIP). Investments in water and road infrastructure, a hydrogen highway coupled with the port funding, strengthened approval processes, community engagement, clean industry investment and new industry skills are some of those foundations.
The Hunter is well prepared to capitalise on the government's Renewable Energy Superpower vision with strong collaboration already in the hydrogen sector, which received more than $8 billion in the budget. The NewH2 Energy Cluster, the Hunter Hydrogen Masterplan, NSW Hydrogen Hub funding and several hydrogen projects in development in the region will benefit from this funding. While the $100 million investment in the Port of Newcastle's Clean Energy Precinct is not new, it supports the port's common user infrastructure for the region to expand the green export economy, and keep the Hunter as a global energy export hub.
BZE welcomes the other big winner in the Future Made in Australia: critical minerals, which will receive $7 billion over a decade in production tax incentives. This will add value to key minerals needed for the transition and will be key to supporting other regional industries including battery manufacturing.
The Future Made In Australia includes $523.2 million for the Battery Breakthrough Initiative. It's a good start but falls short of BZE's recommendation for $2 billion in equity funding to support regional innovators such as Energy Renaissance and Allegro Energy to scale their technologies. This initiative will be administered by the Australian Renewable Energy Agency to promote manufacturing capabilities at the "highest value opportunities in the supply chain". BZE looks forward to better understanding how this investment helps home-grown battery manufacturers.
Local manufacturers of electric vehicles, such as Ampcontrol and Batt Mobile Equipment, will need to look to the expanded ARENA funding to scale their operations. With the funding spread over a seven to 10 year horizon, and ARENA taking on a much larger workload, the speed at which this funding can be delivered to regions is crucial. Local industry has noted that seeking ARENA funding is a significant time commitment with an uncertain outcome, making it high risk for many small and medium-sized enterprises.
The announcement of a new national circular economy framework is welcomed. As we set up the Future Made in Australia, we need to map the end-of-life logistics for clean technologies now. This will allow us to incorporate resource recovery considerations in design so that, as these technologies come to the end of their life, we can recover valuable materials to reduce the environmental impact. Hunter initiatives involved in the circular economy include the Living Lab in Lake Macquarie, Hunter Joint Org's circular economy program and the regional manufacturing and circular economy accelerator.
There is a lot in the budget for hydrogen, and while the Hunter stands to benefit, caution is needed. While some key coal customers are looking to the Hunter to supply hydrogen, BZE's Export Powerhouse shows that hydrogen is best used to decarbonise commodities (green steel, green ammonia etc), not as an export fuel.
Australia stands to gain much from electrification, and batteries are the cornerstone of scaling renewable energy, providing grid stability and enabling electric transport. Overall, this budget does set a clear direction in diversifying the Hunter's economy away from fossil fuels. In embracing this ambitious vision, the Hunter is poised to lead the nation in renewable energy and to secure a sustainable and prosperous future for generations to come.
