Summary of actions
New actions
- Battery Breakthrough
- Building Future Battery Capabilities
- Support to deliver the Australian Made Battery Precinct
- Critical Mineral National Productivity Initiative
Existing actions
- State and territory government initiatives
Linked initiatives
- Australian Industry Participation National Framework
- Buy Australian Plan
- National Energy Transformation Partnership
Opportunities
All states and territories have a role in making Australia a renewable energy superpower. Each is home to either vast reserves of critical minerals, cutting-edge battery projects or ambitious emissions reduction targets. All jurisdictions are working to shift to renewable energy. Supporting an Australian made battery industry needs coordination and joint effort across government at all levels – industry, business, unions and research.
Greater coordination across all levels of government will help streamline processes to support basic infrastructure, including access to reliable energy, water and industrial land ready developments.
One example of coordinated action is by local governments through the Climate Council’s Cities Power Partnership pledge. More than 180 local councils, representing over 70% of Australians, have promised to work towards a clean energy future. This pledge involves choosing 5 actions to advance renewable energy and electrification in local government areas. These include policies that increase battery uptake such as:
- installing renewable energy (including battery storage) on council buildings
- electrifying public transport systems and fleet vehicles
- support community renewable energy projects.
The grid will have an estimated 33GW of storage to hit 82% renewables by 2035 (AEMO, 2023). Government policies have a role in creating this demand for batteries. As well as indirect incentives, governments are directly involved in buying batteries though procurement, grants, incentives, underwriting and the activity of state-owned corporations.
Making the most of energy transformation programs
Australia is acting on climate change, to reduce its emissions 43% by 2030 and hit net zero by 2050. To meet this target, federal, state, territory and local governments have substantial policies to procure, subsidise and underwrite renewable energy, including batteries. The government has a target of 82% renewables by 2030. We are unlocking over $67 billion in private investment into renewable energy deployment through the Capacity Investment Scheme, Renewable Energy Transformation Agreements and the National Energy Transformation partnership.
These programs often have distinct assessment criteria, or eligibility requirements, that can be developed to consider Australia’s industrial capabilities. For example, NSW’s Electricity Infrastructure Roadmap’s auctions include regional development criteria, including local supply chain and workforce requirements, for its billion-dollar renewable energy tenders. Each round represents billions in renewable energy projects.
Harnessing the power of government-owned corporations
As well as direct government grants, several state-owned corporations operate in the electricity market. This includes Snowy Hydro (Commonwealth), Western Power and Horizon Power (WA), the State Electricity Commission (Victoria) and Power and Water Corporation (NT) among others. While independent, they follow government regulations, including around financial performance and risk management. These companies have large operating budgets that can also create opportunities for local manufacturers.
Supporting Australia’s skills and knowledge base
Given the growing demand for battery storage, battery procurements can serve a dual role as demonstration projects. Program design can reflect this. This may include boosting technology developments for nascent applications, demonstrating novel system management or proving a new operating model for batteries.
As an example, ARENA has a ‘knowledge sharing requirement’ for projects under the ARENA Act 2011. This means, while respecting IP, that advances found in projects benefit the entire renewables sector.
Aligning state transport procurement
Several state and local governments will be electrifying their bus fleets and buying other forms of battery electric transport. We manufacture or assemble much of this electrified public transport domestically. These purchases are sometimes already subject to local content requirements that create opportunities for other companies in the supply chain. State and territory local content requirements are often specific to that state or territory and don’t necessarily account for other Australian made products. Reports such as the National Transport Commission’s electric bus evaluation finds that the scale of combined demand helps justify capital investment in local manufacturing (NTC 2023).
What we are doing
All state and territory governments are working to advance their battery industries. Below is a non-exhaustive snapshot of these activities and advantages:
NEW SOUTH WALES: NSW is home to battery minerals, energy storage projects, research and several battery manufacturers. The Net Zero Manufacturing Initiative will provide $275 million in clean energy manufacturing grants, including for battery technologies to improve domestic supply. To serve potential battery manufacturing industries, TAFE NSW is building a manufacturing skills centre.
VICTORIA: Victoria is home to several battery research facilities and innovative battery businesses. The Victorian Government’s Made in Victoria 2030: Manufacturing Statement identifies batteries under its Zero and Low Emissions Technologies industry priority. The Victorian Government has also set an energy storage target of at least 6.3GW by 2035.
QUEENSLAND: QLD is home to several battery minerals. Under the QLD Government’s Energy and Jobs Plan, the state is targeting 70% renewable energy by 2032. Battery manufacturing is a critical part of this transition. The QLD Government has promised $500 million for grid and community batteries, as well as the $100 million Critical Minerals and Battery Technology Fund. The Queensland Battery Industry Strategy provides $570 million to holistically build QLD battery manufacturing.
WESTERN AUSTRALIA: WA has vast reserves of critical minerals, existing export markets and integrated industrial expertise. This includes battery grade chemical production. The WA Government produced a Future Battery Industry Strategy in 2019. Western Power is buying and installing over 4000 standalone power systems, incorporating solar and a battery to support grid security.
SOUTH AUSTRALIA: SA has large resources of battery minerals. It has 67% of Australia’s copper resources, and 65% of our graphite. The SA Government’s $50 million grid scale storage fund has funded large scale battery projects. This has helped renewable energy generate 70% of underlying demand in SA in 2022.
TASMANIA: TAS businesses manufacture battery powered electric ferries and mining equipment. It has nickel reserves and chemical industries for further development along the battery value chain.
NORTHERN TERRITORY: The NT is home to the world’s largest manganese deposits and other battery minerals. The NT Government has signed a memorandum of understanding with manufacturers Aleees and Avenira to produce Cathode Active Materials.
AUSTRALIAN CAPITAL TERRITORY: 110 MW of utility-scale batteries have been installed in the ACT under reverse auction contracts towards their 100% renewable energy target. The ACT Government has installed batteries at government sites and gives interest free loans for home batteries under its Sustainable Household Scheme.
Linked initiatives
- The government is investing $10.2 million in 2024–25 to work with states and territories to identify potential common user facilities for critical minerals processing, including battery minerals, through the Critical Mineral National Productivity Initiative (CMNPI). These facilities, when developed, will support small and medium sized mining companies to start downstream processing of critical minerals. They will also help SMEs to engage in the circular economy through activities including recycling and reprocessing of waste batteries and mining byproducts.
- Building on the National Energy Transformation Partnership framework, the Australian Government will negotiate Renewable Energy Transformation Agreements with states and territories. This will achieve shared aims in the renewable energy transition. This includes addressing non-market barriers to investment, such as planning and environmental approval bottlenecks.
- Working to build domestic industry capability by leveraging government procurement through our Buy Australian Plan. This includes improving local industry participation opportunities through Australian Industry Participation policy.
- The Major Projects Facilitation Agency and the Major Project Status provide support for projects, including with state and territory facilitation offices to assist project developers with navigating state and territory government approvals.
- Engaging with all jurisdictions on the following issues:
- Energy and Climate Change Ministerial Council – standards and regulations around home and neighbourhood battery installations, and Clean Energy Supply chains.
- Environment Ministers’ Meeting – recycling and the circular economy
- Infrastructure and Transport Ministers’ Meeting – Decarbonisation of Transport Working Group
- Ministerial Council on Trade and Investment – the council agreed on a coordinated national approach to clean energy and supply chain security (Farrell 2023) including across critical minerals and consistent environmental, social and governance national messaging to support investment attraction (Farrell 2024).
What we will do
- The $523.2 million Battery Breakthrough will provide production-linked incentives to support Australian manufacturers to develop critical battery manufacturing capabilities. It provides a pathway to transition Australia’s industries and jobs in states and territories from a ‘dig and ship’ economy to manufacturing high demand goods in a net zero economy.
- The $20.3 million Building Future Battery Capabilities measure will build our future battery capabilities and support the development of nationally consistent battery standards and guidelines.
- $5.6 million has been committed to conduct options analysis and research to support the development of the Australian Made Battery Precinct, in partnership with the Queensland Government. The design of the precinct will be guided by the National Transformation Principles, with oversight from the NZEA, in alignment with the government’s Future Made in Australia agenda.
By working with all levels of government, the government will take a coordinated and consistent approach to developing the battery industry in Australia. A joint approach to procurement will advance battery technologies and develop skills and knowledge across all jurisdictions. This will centrally organise and lead Australian battery manufacturers so they can compete globally.