Australia's Budget 2024 brings support for renewables, hydrogen

Australian Treasurer Jim Chalmers on Tuesday presented the Albanese Labour government’s 2024-25 Budget, including a AUD-22.7-billion (USD 15bn/EUR 13.9bn) green manufacturing support package called Future Made in Australia through which the country seeks to become a "renewable energy superpower."

Most notably, the particular programme introduces a AUD-6.7-billion renewable hydrogen production tax incentive of AUD 2.00 per kilogram starting from 2027-28, sets aside AUD 1.7 billion for the purpose of promoting net zero innovation, including for green metals and low-carbon fuels, and allocates AUD 1.5 billion for production incentives supporting the battery and solar panel supply chains. An additional production tax incentive with a total estimated cost of AUD 7 billion will be introduced for the processing and refining of critical minerals.

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For renewables, the Budget provides AUD 134.2 million to better prioritise project approvals when these projects are deemed of national significance. Faster decisions are also expected to be made on environment, cultural heritage and planning approvals.

Furthermore, the government will cooperate with the states and territories through the Energy and Climate Change Ministerial Council to speed up electricity grid connections. This is expected to deliver an additional 3.2 GW of capacity.

Meanwhile, the Australian Renewable Energy Agency (ARENA) will get a AUD-5.1-billion boost, which includes AUD 1.7 billion for the new Future Made in Australia Innovation Fund to unlock private capital across sectors such as green metals and low-carbon liquid fuels.

In response to the announcement, the Clean Energy Council said that this is "the biggest clean energy Budget in Australia’s history." Chief Executive Kane Thornton commented that it puts renewable energy at the centre of the country's economic future.

“The Clean Energy Council has long advocated for a response to the United States Inflation Reduction Act and this Budget delivers on that,” Thornton stated.

(AUD 1.0 = USD 0.663/EUR 0.612)