The federal government is looking to fast-track investment and innovation for low emissions technologies through a new $1 billion Low Emissions Technology Commercialisation Fund.
Prime Minister Scott Morrison framed the plan as a natural extension of the government’s newly announced pathway to net zero emissions by 2050.
“Our plan to reach net zero by 2050 is an Australian one that’s focused on technology not taxes and this fund backs in Australian companies to find new solutions,” he said.
Set to be administered by the existing Clean Energy Finance Corporation (CEFC), the establishment of the fund includes a $500 million capital investment from the government, plus another $500 million from the private sector.
The Prime Minister said that the fund would help Australia become a world leader in creating affordable and scalable low emissions technology through investments in carbon capture and storage, solar panels, soil carbon and other low emissions technologies.
“We are backing Australian businesses by creating an environment for their successful ideas to thrive in contrast to Labor’s approach to always wanting to tax success,” he said.
Federal Minister for industry, energy and emissions reduction Angus Taylor said that the fund would underpin and support Australian innovation while also earning a positive return for taxpayers.
“It will address a gap in the Australian market, where currently small, complex, technology-focused start-ups can be considered to be too risky to finance,” he said.
The government said it expects a return of between $3 and $5 per dollar put into the fund, with an estimated 160,000 jobs to be created by 2030.
Mr Taylor also argued that the fund would complement other investments and build on the CEFC’s legacy as the world’s largest government-owned green bank.
The government said that it plans to introduce the legislation necessary to set up the fund during the coming term of Parliament and before the next election.
This is necessary because the current legislation that underpins the mandate of the CEFC prohibits the agency from investing in technologies like carbon capture and storage.
The federal government unsuccessfully attempted to expand this remit earlier back in June 2021.
As per the Australian government’s Long Term Emissions Reduction Plan, “large-scale CCUS projects can underpin new low emissions industries (including clean hydrogen) and provide a potential decarbonisation pathway for hard-to-abate industries.”
The federal government has said that it has invested $790 million in CCUS and related low emissions technologies since 2008.
However, the real world results delivered by the technology thus far have largely fallen short in the years since.
“Carbon capture and storage has failed to deliver anything for decades. Whilst the price of solar and renewable energy has plummeted, carbon capture and storage has remained hugely expensive,” Smart Energy Council chief executive John Grimes said.