Australia needs to change into a renewable power superpower. Can it? | EUROtoday

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Hannah Ritchie,BBC News, Sydney

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SunDrive’s Maia Schweizer thinks Australia has what it takes to change into a photo voltaic panel manufacturing hub

Hidden amongst thick bushland within the outer suburbs of southern Sydney sits an expansive facility housing a technological breakthrough.

It’s right here that Australian firm SunDrive Solar makes its “special sauce”: a brand new – prime secret – components that it says has solved “a very high value problem”.

Its huge innovation? Finding a technique to substitute the silver utilized in photo voltaic cells with copper, which was beforehand thought not possible.

“Silver is expensive, scarce and environmentally disastrous, and it limits how much solar can be rolled out around the world,” explains chief industrial officer Maia Schweizer.

“Copper is also highly in demand, but it’s 1,000 times more abundant, and 100 times lower cost.”

The start-up is among the beneficiaries of the federal government’s Future Made in Australia plan – a collection of insurance policies that goal to show the nation right into a “renewable energy superpower” by investing in homegrown inexperienced industries.

But some specialists query whether or not the $A22.7bn ($15bn; £11.8bn) bundle, which includes tax incentives, loans, and kick-starter grants – is sufficient to meet these lofty ambitions.

And local weather scientists say that if Australia needs to be a significant participant within the internet zero transition, it must cease peddling fossil fuels.

Australia’s financial system has lengthy been powered by its pure sources, equivalent to coal, fuel and iron ore.

But its vital minerals – a lot of which underpin essential low emissions applied sciences – are exported uncooked, and refined overseas, predominantly by China.

It’s a dig-and-ship mannequin of commerce that has earned Australia a fame because the world’s quarry, and seen it lose out on a big chunk of change additional up the provision chain.

Lithium – which is used within the batteries that retailer renewable power and energy electrical automobiles – is one instance.

Despite being liable for greater than half of the world’s provide, Australia captures simply 0.5% of the worldwide $57bn lithium battery market, in line with the nation’s nationwide science company.

The Future Made in Australia coverage – which was formally introduced in April – seeks to alter that, by providing tax breaks and loans to firms looking for to course of vital minerals at residence.

Doing so, the federal government argues, is a nationwide safety precedence, as international locations study their commerce dependence on Beijing, and look to insulate themselves towards provide chain shocks.

“This is not old-fashioned protectionism or isolationism – it is the new competition,” Prime Minister Anthony Albanese mentioned, when asserting the plan.

“We need to aim high, be bold, and build big, to match the size of the opportunity in front of us.”

Alpha HPA Rob Williamson at work at Alpha HPAAlpha HPA

Alpha HPA is constructing one of many world’s largest alumina refineries in Queensland

Queensland-based Alpha HPA is among the firms the federal government has tapped to execute its imaginative and prescient.

Like SunDrive, it views itself as a disruptor, attributable to its potential to create ultra-high purity aluminium merchandise – utilized in issues like semiconductors and iPhones – with a decrease carbon footprint than abroad opponents.

Thanks to a A$400m federal mortgage, it’s constructing one of many world’s largest alumina refineries close to the coastal metropolis of Gladstone, which it says will create lots of of native jobs.

It’s an enormous supply of delight, given that there’s nonetheless scepticism over whether or not Australia could make issues, after a long time of outsourcing its manufacturing to China, Alpha HPA’s chief working officer Rob Williamson says.

“Anybody that puts forward the case that we don’t have people in this country to do [this work] is just not trying,” he adds.

SunDrive is on a similar journey.

Without government support, Ms Schweizer says, the company might have moved offshore.

Instead, it’s looking to transform one of the country’s oldest coal power stations into a massive solar panel manufacturing hub.

Currently, one in three Australian households have solar panels, the highest rate in the world, and yet only 1% are made locally – with China responsible for more than 80% of global production.

“Every single mineral that you need to make a solar panel, we’ve got one of the top three reserves in the world,” Ms Schweizer explains.

“Now there’s the possibility of the end-to-end value chain coming onshore in Australia for the first time, which is super, super exciting.”

The Made in Australia pledge has won the support of the country’s biggest renewable energy industry trade bodies, who say the investments could be “game changing”.

“It’s a big opportunity for us to be an exporter of climate solutions to the world instead of climate problems,” John Grimes, who heads the Smart Energy Council, says.

But some climate experts warn it is being “severely undermined” by the government’s recent decision to champion gas until 2050 and beyond despite global calls to rapidly phase out fossil fuels.

“We’re sending a really mixed message to investors,” says Polly Hemming, the director of the Australia Institute’s climate and energy programme.

Alpha HPA Alpha HPA production facility Alpha HPA

Alpha HPA already produces a range of ultra-high purity aluminium materials

“This government has continued to approve new gas and coal projects – it’s flown to Japan, India, Korea, and Vietnam to secure long-term markets for gas and coal.

“If we really wanted to be a green energy superpower, we wouldn’t be relentlessly pursuing customers for our fossil fuels,” she says.

One of the nation’s leading climate scientists agrees.

“There is a very deep contradiction at the heart of the two policies,” says Prof Bill Hare, chief executive of Climate Analytics and author of numerous UN climate change reports.

“The Future Made in Australia [plan] is playing second fiddle to the government’s gas strategy.”

To understand how, Ms Hemming says you need to “follow the money”.

According to an analysis from her thinktank, last year alone, state and federal governments spent A$14.5bn subsidising fossil fuel use across Australia, and that sum is only expected to balloon, according to budget estimates.

By contrast, she says the A$13.7bn set aside to process critical minerals and incubate Australia’s nascent green hydrogen industry “isn’t real money”.

That’s because it will take the form of tax breaks over the course of a decade, which can only be cashed in on production starting from 2027 – a model which policymakers say will ensure taxpayers’ money is not wasted.

But all the green hydrogen projects – many of which are being led by the nation’s largest mining and energy companies – are yet to be built. And the incentives could be scrapped before they get off the ground if there’s a change in government.

“It’s like me having a healthy eating and junk food policy running at the same time in my home and telling my kids, ‘You can have $10 a week now if you keep eating junk food’,” says Ms Hemming.

“Or, ‘I’ll give you $2 in 2027 if you switch to broccoli’. What do you think they are going to prioritise?”

Some energy experts have also cast doubt over the business rationale behind green hydrogen – given the industry is still in its infancy and riddled with unknowns.

Others worry it could divert investment away from the renewable power sources that have already proven their worth, resulting in delayed climate action.

But Mr Grimes says that green hydrogen will play an essential role in “stripping emissions” out of Australia’s carbon-intensive mining sector – as firms search for low cost inexperienced sources of gasoline to proceed powering their operations.

And larger image, he argues that the federal government’s new inexperienced investments ought to be assessed as “a milestone first step” relatively than an finish level.

“The government knows that if it doesn’t pivot beyond its exports of coal, gas and iron ore soon, Australia risks becoming the Kodak economy of the future: a big deal one day and completely irrelevant the next.”

Getty Images Iron ore being loaded at a mine in Western AustraliaGetty Images

The Australian financial system has been centered on exporting uncooked supplies for a few years

Australia isn’t the one nation seeking to place itself because the engine room of the brand new inexperienced financial system.

Dozens of countries are placing ahead formidable proposals, such because the European Union’s Green Deal or America’s gargantuan Inflation Reduction Act.

Globally, policymakers have already invested over A$2tn in clear power initiatives since 2020, in line with the International Energy Agency.

But Australia has some compelling pure benefits, equivalent to enviable wind and photo voltaic capabilities, shops of vital minerals and uncommon earths, and a robust mining infrastructure community that may be repurposed.

If used accurately, all of the specialists the BBC spoke with agreed it has each likelihood of securing its place as a vital inexperienced buying and selling associate amongst allies.

Getting there although, they are saying, would require even better funding – significantly in analysis and improvement, which is at the moment at 30-year lows.

And they’ve warned that the federal government can’t afford to tug its ft – some extent which Mr Albanese himself has addressed head on.

“We have to get cracking. We have unlimited potential, but we do not have unlimited time.

“If we don’t seize this moment, it will pass. If we don’t take this chance, we won’t get another. If we don’t act to shape the future, the future will shape us.”