The Net Zero Economy Authority (the Authority) will play an important role in coordinating the investment needed for Australia’s positive and orderly transformation to a net zero economy.
Australia’s efforts to reduce emissions will generate significant economic change in regions across the country as some industries decline and others emerge. Significant public, private and foreign investment is needed to develop more sustainable sources of long-term prosperity and to support communities through this change.
The investment required to transition Australia’s economy will vary but is interlinked. For example, in regions where coal-fired power stations are scheduled to close, investment is needed to develop new industries that provide jobs now and in the future. Emissions-intensive industries, like steelmaking or alumina refining, will need new investment in technologies to reduce emissions from their production processes, in addition to securing power from new renewable energy sources. Further investment is needed to capitalise on emerging opportunities in hydrogen and critical minerals processing.
We also need investment in enabling infrastructure to support the development of new industries and transformation of existing industries. The transition will be underpinned by investments in renewable energy generation, poles and wires to transport electricity to where it is needed, and energy storage technologies, such as large batteries, to ensure renewable energy supply is firmed and reliable.
And to attract people to live and work in the regions where this is all happening, investment will be required in the things that make communities thriving and positive places to live and work. This could include investment in housing, transport or utilities.
The Australian Government has a wide range of instruments that will drive this investment, such as the Australian Renewable Energy Agency, the Clean Energy Finance Corporation, the National Reconstruction Fund and Austrade.
However, what is missing is a coordination point to bring this work together and manage the transformation as a whole, ensuring this process is smooth and the benefits for communities, workers and regions are shared.
The Net Zero Economy Agency has been working with industry, investors, state governments and other key stakeholders since its establishment to understand how we can best do this as a legislated Net Zero Economy Authority.
The Authority will focus on supporting what regions need to transition effectively. This includes identifying and facilitating investment in ‘transformational projects’ that will bring positive and orderly change to a region – for example, a proposal to develop a renewables-based hydrogen production precinct that will help decarbonise nearby manufacturing.
This investment facilitation model will be developed in consultation with investors, seeing government and the investment community work together to accelerate Australia’s net zero transformation.
We will focus on regions where there are more immediate impacts and opportunities in the net zero transformation, such as Gladstone and Central Queensland, the Latrobe Valley, Newcastle and the Hunter, and the Upper Spencer Gulf. These are regions built largely around emissions-intensive industry, and which are the most exposed to risks in the transition. Investment is necessary to ensure these risks are mitigated and new opportunities are realised.
We will focus on facilitating investment where there’s a strong case for government to be involved, with clear benefits for communities and regions, and will look to use existing funding programs.