Renewed investment in Australia’s superpower

Renewed investment in Australia’s superpower

In the 2024 Federal Budget, announced by Treasurer Jim Chalmers on Tuesday, 7 May, the Government re-stated its desire to ‘make Australia a renewable energy superpower’.

Forming a significant part of the Future Made in Australia campaign, the Government announced four key areas of development in renewable energy – some of which build on or further drive the measures introduced in 2023.

1. Cheaper, cleaner, greener, sooner

The Government has committed over $65 billion to harness Australia’s fortunate and readily available renewable energy sources. A promised $27.7 million investment is expected to see ‘Australians benefit from cheaper, cleaner energy sooner’ through integrating consumer energy into the grid.

2. New industries for net zero

Jobs, skills, an innovation fund and a 10-year extension for the Australian Renewable Energy Agency are a few of the key drivers leading our growth into new industries, including Australia’s pipeline of hydrogen projects.

3. Drumming up demand for green exports

An attempt to improve transparency and ease of doing business with trading partners in sourcing low-emission products is expected to provide better markets, improved product standards, and better market recognition of high environmental, social and governance standards in the critical minerals sector.

A commitment of $32.2 million is intended to fast-track the introduction of renewable hydrogen, the initial phase of the Guarantee of Origin scheme, before expanding to accredit the emissions content of green metals and low‑carbon liquid fuels.

4. Reaching our net zero goals

With an investment of $399 million, the Government will establish the Net Zero Economy Authority to support the economy‑wide net zero transformation, including its commitment to reach net zero greenhouse gas emissions by 2050.

The Australian Carbon Credit Unit scheme has been promised $48 million in reforms, and $20.7 million to improve community engagement.

Sustainable finance

Alongside these measures for renewable energy, the Government has also looked to bolster private sector investment in sustainable activities through its $17.3 million commitment. Crucial to this commitment is the extension of a sustainable finance taxonomy to the agriculture industry and an attempt to address greenwashing by developing a labelling regime for financial products marketed as sustainable.

BDO comment

With limited detail to date, and some overlap from the 2023 Budget, we will be watching with anticipation to see if the measures introduced will be enough to establish Australia as a ‘renewable energy superpower’.

While the Government has committed to net zero greenhouse gas emissions by 2050, or sooner, it’s a commitment on behalf of the people and market in Australia. It’s pleasing to see the Government take some accountability through its commitment to developing alternative energy sources, supporting innovation and skills development for the jobs of the future, and improving access to green trade.

As we progress towards 2050, it will be important to ensure the frameworks for communication and reporting continue to develop so that organisations provide transparent, clear sustainability-related disclosures and information allowing customers, investors, and regulators alike to make informed purchasing decisions.