Main content area

5. Support Australian innovation and manufacturing

Infographic showing the objectives and actions of this priority initiative. Text description follows


  • Encourage Australian innovation in transport technologies and future fuels production capability to continue creating local jobs.
  • Support Australia’s high-value critical minerals mining and manufacturing capability to capture export markets through the government’s Modern Manufacturing Strategy.


  • Analyse domestic fuel needs and opportunities
  • Back the Bioenergy Roadmap
  • Invest in priority low emissions technologies and enabling infrastructure
  • Support Australian manufacturing and innovation through the Modern Manufacturing Strategy
  • Support access to global markets for Australian low emissions businesses


Low emission vehicles draw on skills and innovation in automotive design, systems integration, component manufacturing and mining of critical minerals.

Australia’s workforce has world-class skills in these areas. We also have businesses that generate high-value intellectual property in these areas. Some of these businesses are:

  • Tritium
  • Carbon Revolution
  • Nissan
  • ACE EV Group
  • truck manufacturers such as PACCAR, Volvo and SEA Electric
  • bus manufacturers such as Custom Denning and Volgren.

Australia has significant reserves of the critical minerals, rare earths and important base metals needed for electric vehicle and battery technologies. Capturing opportunities in the electric vehicle and battery energy storage supply chain could create 34,700 jobs in Australia by 2030. Global demand for batteries could increase tenfold to reach $151 billion by the same year (Future Battery Industries CRC 2021).

Australian Clean Energy Electric Vehicle (ACE EV) Group

The Australian Government is supporting domestic battery electric vehicle manufacturing through a $5 million grant to ACE EV Group for an advanced manufacturing facility and vehicle-to-grid trial.

Australia’s resources sector is already responding to this opportunity. Australia’s combined export earnings from key battery metals (lithium, copper and nickel) are forecast to grow to $19.6 billion in 2022–23 (Commonwealth of Australia 2021b).

Initial rounds of grant opportunities available through the Australian Government’s Modern Manufacturing Strategy shows that the private sector is willing to co-invest in transport-related manufacturing. The areas with the most potential are:

  • heavy transport manufacturing (including battery electric and hydrogen trucks and buses)
  • electric vehicle charging equipment.

Australia can be globally competitive for these advanced products, especially where we have an innovation edge.

There is also a role for the government to continue to support research and development of new technologies through bodies such as CSIRO and ARENA. This is particularly important for hard-to-abate sectors beyond road transport, such as in the maritime and aviation sectors. Over $75 million has already been committed through ARENA to advance low emissions transport technologies, including for hydrogen, electric vehicles and biofuels.

'Given that Australia has extensive reserves of minerals that are used for vehicles that utilise electrified powertrains, developing the capability to process these products beyond the raw material stage would no doubt be advantageous.'

– Federal Chamber of Automotive Industries


The Australian Government will identify opportunities to invest in future fuels. Investments will reinforce the government’s objective of supporting innovation and competitive modern manufacturers.

The government is analysing Australia’s likely future fuel mix, including ensuring we have the right access to both traditional fuels and new technologies to ensure energy security (Actions 5.1 to 5.3).

Co-investment will support Australian manufacturers and innovators to scale up, become more competitive, and capture opportunities across the value chain in new domestic and international markets (Actions 5.4 and 5.5).



Lead agency

Delivery dates


Analyse domestic fuel needs and opportunities

The government is funding research to model Australia’s future mix of transport fuels. This work will demonstrate:

  • the industry growth opportunities future fuels can bring
  • the mix of fuels needed in the future, including traditional fuels and future fuel technologies.


2021 to 2022


Back the Bioenergy Roadmap

The forthcoming Bioenergy Roadmap will consider the role of  biofuels across transport sectors, including road and hard-to-abate sectors, such as aviation and maritime.





Invest in priority low emissions technologies and enabling infrastructure

The Low Emissions Technology Statement 2021 identifies hydrogen as a priority low emissions technology and hydrogen refuelling as enabling infrastructure. The government is investing in hydrogen production and infrastructure so Australia can become a leading exporter by 2030.

The upcoming National Hydrogen Infrastructure Assessment will also help to determine the infrastructure needed to support future use of hydrogen in transport.




Support Australian manufacturing and innovation through the Modern Manufacturing Strategy
The government’s $1.5 billion Modern Manufacturing Strategy is helping Australian manufacturers build scale, competitiveness and resilience. Transport-related opportunities have been identified in the National Manufacturing Priority areas, including recycling and clean energy, resources technology and critical minerals processing, and defence.




Support access to global markets for Australian low emissions businesses

The Special Adviser to the Australian Government on Low Emissions Technology is working with international partners to strengthen collaboration between Australian and international businesses, including to facilitate opportunities in global markets for Australian businesses. This work is funded by the government’s $565.8 million commitment to deliver low emissions international technology partnerships and initiatives by funding research and demonstration projects.