2022-23 Budget backs Australian industry

31-03-2022

The 2022-23 federal Budget has been designed to create highly-skilled jobs, backing ‘traditional’ Australian industry while building new clean energy industries, securing reliable and affordable energy, and putting Australia on track to achieve net zero emissions by 2050, according to a statement.

Minister for Industry, Energy and Emissions Reduction Angus Taylor said $2.4 billion of new initiatives in the 2022-23 Budget under the industry, energy and emissions reduction portfolio set a path for a stronger economy.

“Our Modern Manufacturing Strategy is already delivering and accelerating the transformation of Australian manufacturing and now we want to further supercharge its job-creating power,” Taylor said. 

He added that it was the technology not taxes approach, that would ensure Australia meets and beats its 2030 emissions target, and plays a leading role in bringing down global emissions by investing in the technologies that won’t just help Australia, but will help the world. 

“We are also investing in critical infrastructure to ensure reliable and secure energy for Australian households and businesses, and build on our strong record of reducing prices.” 

Electricity costs for households are now at their lowest levels in eight years. In the last two years alone, the ACCC has found power costs have dropped eight percent for households - that's a $128 a year drop. 

For small businesses, the average cost has fallen by 10 percent over the last two years, and for large business customers, costs have fallen by 12 percent over the same period. 

Australian east coast gas wholesale prices have remained internationally competitive, between 70 to 80 percent lower than prices seen in Europe.

 Industry

The 2022-23 Budget continues to back-in Australian manufacturing with an additional investment of more than $1 billion. This builds on our initial $1.5 billion investment already committed through the Modern Manufacturing Strategy.

This commitment to Australian manufacturing will secure supply chains and jobs during a period of heightened global uncertainty, as the Morrison Government works in partnership with industry to build a strong, modern and resilient manufacturing sector.

The Government is investing an additional $750 million into the Modern Manufacturing Initiative to support transformational manufacturing projects and catalyse private sector investment in Australian manufacturing. An additional $200 million in funding is also being provided as part of the Regional Accelerator Program to strengthen supply chain resilience and sovereign manufacturing capability.

An extra $53.9 million has been committed for round 3 of the Manufacturing Modernisation Fund to help small and medium manufacturing businesses which will co-fund capital investments by manufacturers across the National Manufacturing Priority areas to adopt new technologies enabling them to scale up, grow and compete internationally.

An additional $4.7 million will support women to build a career in Australian manufacturing, contributing to a strong, diverse and skilled manufacturing workforce for the future. Over the next 12 months the Government will work with industry to finalise Manufacturing Investment Plans for each priority sector to guide further long-term investment in Australian manufacturing.

Taylor added that the Manufacturing Investment Plans will be developed jointly with industry and will outline the concrete steps to be taken in each sector so they can reach their full potential.

Energy and emissions reduction

The Budget also includes $1.3 billion of new investment to maintain energy security, keep downward pressure on energy prices while reducing emissions.

These measures will further support affordable, reliable and secure energy and help Australia reach its target for net zero emissions by 2050, without imposing new taxes or financial burdens on households, businesses or industry.

This investment includes:

·        $300 million to support low emissions LNG and clean hydrogen production at Darwin, together with associated carbon capture and storage infrastructure. Darwin is positioned to become one of the world’s leading low-cost clean energy hubs, with access to excellent onshore and offshore natural gas and greenhouse gas storage resources, including the Beetaloo and Petrel basins and the Barossa and Bayu-Undan fields.

·        $247.1 million to support increased private sector investment in low emissions technologies including hydrogen, and the continued development of a hydrogen Guarantee of Origin scheme.

·        $200 million to increase onshore processing and value-add of iron ore exports, to support low emissions steel production in Indo-Pacific customer countries like Japan and Korea.

·        $200 million to enhance Australia’s supply chain security through new low emissions manufacturing facilities (using hydrogen and hydrogen-derivatives like ammonia, as well as carbon capture utilisation and storage) in the Pilbara region.

·        $148.6 million to support more investment in affordable and reliable power, including the development of community microgrid projects in regional and rural Australia.

·        $100 million to de-risk private sector investment in firm generation and grid infrastructure to increase system strength and capacity in the Pilbara region.

·        $100 million to support pre-Final Investment Decision activities and early works to make the Port of Newcastle ‘hydrogen ready’.

·        $50.3 million to accelerate the development of priority gas infrastructure projects consistent with the Future Gas Infrastructure Investment Framework and support investment in carbon capture and storage pipeline infrastructure.

Minister Taylor said with the Budget measures, the Government has committed more than $22 billion of public investment in low emissions technologies by 2030.

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