Additional funding has been provided so ARENA can remain on the frontline of direct government investment in low emissions technologies.
In line with a recommendation of the King Review (Box 4), the Government will task ARENA to work with the CEFC and other relevant agencies to develop a goal-oriented program targeting a number of the priority low emissions technologies such as low emissions steel, low emissions aluminium, or energy storage.
Industry and state governments will be consulted to co-design the programs, and to determine interest in co-funding.
Low emissions steel and aluminium are suitable targets for co-investment programs as they are hard-to-abate sectors with long-term, strategic funding required. Initial funding will focus on the first stages (e.g. research and development, feasibility and demonstration) required as part of a longer term program. Energy storage technologies would also be suitable targets, focussing more on later stage development (demonstration and commercialisation).
The Government will invite expressions of interest from industry and state government to establish a regional hydrogen export hub. This will be a region in Australia where clean hydrogen users and exporters are co-located, creating efficiencies in supply and focal points for innovation and skills development.
Government funding for this hub will help to provide the clean hydrogen demand to complement ARENA’s current support for clean hydrogen supply technologies. It will complement the finance for hubs currently available from the CEFC. It will also help to attract international investment and build global hydrogen supply chain linkages.
In addition to hub support, funding will also be provided to support hydrogen related studies and international research collaborations. These will help to reduce costs, enable rapid industry scale-up and build international supply chains.
The Government will make $50 million available to scale CCS research and development projects into commercial operations, supporting emissions reductions in power generation, oil and gas extraction, natural gas processing, and coal gasification or methane reforming for hydrogen production and other activities.
The Government has introduced legislation to establish the CEFC’s Grid Reliability Fund, to unlock private sector investment for projects that provide reliable, low-cost, and low emissions energy. The Grid Reliability Fund will enable the CEFC to invest in additional low emissions energy storage and generation technologies, as well as supporting transmission and distribution infrastructure, and grid stabilising technologies.
The Government has agreed key recommendations of the King Review and will establish a King Review Technology Co-Investment Fund to address barriers to industry uptake of energy efficiency and create the enabling environment for low emissions technology investments by the private sector.
This Statement’s technology priorities – particularly CCS and soil carbon – will also be supported by the ERF, administered by the CER.
Lastly, the Government is exploring the opportunities for Government investment to ensure the increased uptake of new vehicle technologies is planned and managed, through its Future Fuels Strategy. The Strategy will look to enable all technology choices, including hybrid vehicles, fuel cell electric vehicles and battery electric vehicles so Australians can choose to adopt new new vehicle technologies, where it makes sense for them to do so.
The future of transport in Australia will draw on a range of vehicle and fuel technologies. New vehicles that use electricity or hydrogen as a fuel represent discontinuous innovation (that is, technologies that require end users to change behaviour and change the dynamics of an industry as a result) for our transport system, requiring new infrastructure and integration with the existing electricity grid. While the early stage of deployment means there are currently barriers to the large-scale take up of these vehicles, there are also domestic opportunities to be explored, including the development and widespread rollout of rapid, convenient refuelling and charging solutions. Charging and refuelling technologies have been identified as important emerging and enabling technologies, and these will be considered as part of future Low Emissions Technology Statements. The Future Fuels Strategy will focus on practical actions to allow the private sector to commercially deploy these technologies.
Box 4: The King Review
The Expert Panel, chaired by Grant King, was tasked with examining options for unlocking additional abatement across the economy, with a particular focus on hard-to-abate sectors including industry, transport and agriculture, and energy efficiency.
The King Review was released in early 2020. In its response, the Government indicated it would progress two key recommendations through the Technology Investment Roadmap process:
- Establish a goal-oriented technology co-investment program to accelerate the uptake of transformative, high abatement potential technologies that are not currently cost competitive (recommendation 10.1).
- Provide ARENA and the CEFC with an expanded, technology neutral remit so they can support key low emissions technologies across all sectors and be involved in the delivery of the goal-oriented co-investment program (recommendation 10.2).