Last week’s Federal Budget included a $22.7 billion allocation for Future Made in Australia, including a significant focus on renewable energies and sustainable materials to support the country’s net-zero transition.

The Budget identified five industries aligned with the Federal Government’s National Interest Framework: renewable hydrogen, critical minerals processing, green metals, low carbon liquid fuels and clean energy manufacturing.

These industries will also be crucial to the rail industry’s decarbonisation.

It is expected the initiatives announced as part of the budget will be complemented by the six decarbonisation sector plans currently in development, with consultation on the transport and infrastructure net zero roadmap commencing this week.

Developing the renewable energy sector 

The budget included allocations to support Australian manufacturing of key renewable energy infrastructure, including $500 million to establish a Battery Breakthrough Initiative to grow Australia’s battery manufacturing capabilities and $1 billion for the Solar Sunshot program. Both initiatives will be delivered by the Australian Renewable Energy Agency (ARENA), whose funding has also been extended.

An additional $8.7 billion in funding will support the development of the hydrogen industry, with additional funding for the Hydrogen Headstart program to support early movers in the industry and a Hydrogen Production Tax Incentive for projects reaching final investment decisions by 2030.

With the rail industry’s decarbonisation expected to rely on battery electric and hydrogen technologies, ensuring sufficient access to and affordable supply of renewable energy sources will be vital to the transition to net-zero.

Demand for renewable energy is expected to significantly increase as all industries decarbonise in the lead up to 2050, requiring a coordinated and rapid rollout of new energy infrastructure to support the shift away from fossil fuels.

Industry consultation on the ARA’s soon-to-be-released rollingstock decarbonisation critical path has found energy supply will be a key factor in confirming the commercial availability of these new technologies.

This is perhaps already evidenced by the fact that hydrogen rollingstock trials underway overseas have not yet been replicated in Australia. It is expected greater certainty in hydrogen supply and affordability would support increased research and development for these technologies locally.

The ARA recommended in its response to the Federal Government’s electricity and energy sector plan that investment in renewable energy considers opportunities to align new energy infrastructure with existing transport routes, particularly in regional areas.

This would not only support access to renewable energy sources for the transport sector but would deliver co-benefits to regional areas along key rail lines.

It will also be essential that nationally consistent, universal infrastructure in the development of items such as charging infrastructure to allow the industry to scale up new technologies and realise economies of scale as it transitions away from traditional fuel sources.

A continued focus on commercialising different battery chemistries and ensuring supply chain availability in Australia (including for strategic minerals, manufacturing capabilities and recycling) will also be required as part of the transition to net-zero.

Building manufacturing capabilities

The budget included a commitment to consult on developing a pathway to support green metals manufacturing, while the $1.7 billion Future Made in Australia Fund will also help enable investment in green metals and low carbon liquid fuels.

With green steel set to play a key role in reducing embodied emissions for rail projects, the development of local manufacturing capability would support the reduction of transport emissions over the life of infrastructure projects.

ARA members are already leading key green steel projects in Australia, with low carbon products also increasingly being utilised on rail projects.

The policy also notes the role innovation will play in the development of a strong local economy to support a net-zero future.

The ARA has highlighted the need for a national approach to technology and innovation in rail to drive new solutions and support greater efficiencies in the industry. This will be particularly important as the industry decarbonises.

Supporting the skills transition 

The budget also includes allocations to support the skills transition, including funding for the New Energy Apprenticeship Program, the Building Women’s Careers program for jobs in STEM and the Energy Industry Jobs Plan to support the transition of people working in the delivery of coal and gas fired power.

The ARA has identified the need for additional skills in key areas such as electrical engineering as the industry decarbonises. We will further explore the skills required to support the decarbonisation of the infrastructure sector in a new joint research project to be delivered via Infrastructure Net Zero in 2024.

For more information on the ARA’s sustainability agenda, contact ARA General Manager Sustainability Joeley Pettit.