Australia’s Prime Minister Anthony Albanese has unveiled a plan that will see the country enter the global green subsidies race, going toe to toe with the US and other major economies to attract renewables investment.
Albanese today announced his government will create the ‘Future Made in Australia Act,’ which will “bring together in a comprehensive and coordinated way a whole package of new and existing initiatives” to boost investment in renewables.
The Act is aimed at countering the Inflation Reduction Act (IRA) passed in the US in 2022 and championed by President Joe Biden.
The $370bn in subsidies available to renewables and clean tech firms under the IRA has caused alarm internationally, not least in Europe, which has seen renewables companies park plans on the continent to set up new facilities in the US instead.
The EU Commission presented its own Green Deal Industrial Plan in response to the IRA last year, but many details and specific regulations still need to be worked out or passed by member state governments.
Albanese, who was elected as Prime Minister on a green ticket in 2022, has said Australia can go “toe to toe” even if not “dollar for dollar” with the US on policies to attract investment in renewable energy.
Speaking in the state of Queensland today, Albanese said he will give Australia’s “Net Zero Economy Authority every tool it needs to support resource communities in particular through the coming period of economic change.”
He reiterated that Australia cannot go dollar for dollar” with the US but stressed that “this is not an auction – it’s a competition.”
“And Australia can absolutely compete for international investment when it comes to our capacity to produce outcomes, the quality of our policies and the power of our incentives.”
“Part of the objective here is about Australia presenting potential investors with ‘a single front door,’” he said.
Aside from the US and EU, Albanese cited Japan, South Korea and Canada as countries now “investing in their industrial base, their manufacturing capability and their economic sovereignty.”
“This is not old-fashioned protectionism or isolationism – it is the new competition.”
“These nations are not withdrawing from global trade or walking away from world markets or the rules-based order, and let me be clear, nor should Australia.”
Australia will “continue to champion global markets and free trade,” he said, but it must realise that the “partners we seek are moving to the beat of a new economic reality.”
“We must recognise there is a new and widespread willingness to make economic interventions on the basis of national interest and national sovereignty.”
“And – critically – none of this is being left solely to market forces or trusted to the invisible hand.”
Details of the policy will be set out in a budget next month, he said.
Kane Thornton, chief executive of Australia’s Clean Energy Council, said the speech “marks another decisive moment for Australia’s ambition to secure a place as a leading nation in the global clean energy industry.”
“It is positive news that the Federal Government has plans to back its vision with a substantial policy agenda, putting renewable energy at the centre of our economic future.”
“While the size of Australia’s economy means we cannot match the full scale and reach of the IRA, smart and focussed policy and funding support can leverage our comparative advantages and expand our markets and economy.”
Climate Council CEO Amanda McKenzie said the Act "could be a game-changer that facilitates immediate investment to match the global clean energy shift, supercharge new industries, and cement Australia’s advantage in clean energy."
