The Federal Government has announced the 2022-23 Budget, investing $2.4 billion in new initiatives under the industry, energy and emissions reduction portfolio and investing in water infrastructure and security.
This Budget, the Federal Government has invested record amounts in infrastructure and regional development projects, especially water infrastructure projects; aiming to prepare the country for the future.
Prioritising Australia’s long-term water future
The Federal Government has invested in water infrastructure through the National Water Grid Fund, which is receiving an additional investment of $6.9 billion through the Budget.
The new investments include:
- $5.4 billion for Hells Gates Dam, subject to the completion of the final stage of the business case and regulatory approvals
- $600 million for Paradise Dam Improvement
- Up to $433 million for Dungowan Dam and Pipeline, subject to the finalisation of the business case and approval processes
The Federal Government has also locked in $483 million to build Urannah Dam, pending demonstration of value for money and sufficient public benefit for investment.
The Budget has also committed millions to keeping rivers and wetlands, and surrounding communities, healthy.
Minister for Resources and Water, Keith Pitt, said, “We’re building on the successful Murray–Darling Communities Investment Package with a $97 million Healthy Rivers – Healthy Communities grant program.
Healthy Rivers – Healthy Communities is a program that makes grants of between $100,000 and $5 million available in the Murray–Darling Basin.
The program aims to build stronger and more vibrant regional economies and communities, improve the health of rivers and wetlands, and enhance environmental outcomes through targeted infrastructure investment.
“We’re also investing $2.6 million in a 12-month, independent, systematic, technical assessment of infrastructure in the southern Murray–Darling Basin to make sure we’re well placed to make decisions about the infrastructure of the future,” Mr Pitt said.
“To improve water security for all water users and to help mitigate the impacts of floods and droughts on communities and the environment.”
Mr Pitt also said that the Government is investing $2.1 million in sensible, state-supported water market reform that will improve integrity and public confidence in water markets, and will be informed by recommendations from the ACCC’s Murray-Darling Basin Water Markets Inquiry.
The On-farm Emergency Water Infrastructure Rebate Scheme is also being extended, to help farmers install infrastructure like pumps, tanks, dams and bores through a rebate of up to 25 per cent on eligible projects, up to the value of $25,000.
Energy investment taking the ‘technology not taxes’ road
The Budget includes $2.4 billion of new initiatives under the industry, energy and emissions reduction portfolio, which are expected to support 4,800 jobs.
Federal Minister for Industry, Energy and Emissions Reduction, Angus Taylor, said the 2022-23 Budget is about creating 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.
“Our ‘technology not taxes’ approach will make sure Australia meets and beats our 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,” Mr Taylor said.
“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.”
The Federal Government said electricity costs for households are now at their lowest levels in eight years, with household power costs reportedly dropping 8 per cent in the last two years.
For small businesses, the average cost has fallen by 10 per cent over the last two years according to the Government, and for large business customers, costs have fallen by 12 per cent over the same period.
Australian east coast gas wholesale prices have reportedly remained internationally competitive, between 70 to 80 per cent lower than prices seen in Europe.
The Budget includes $1.3 billion of new investment to maintain energy security, keep downward pressure on energy prices while reducing emissions.
These measures are expected to 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.
Energy investments include:
- $300 million to support low emissions LNG and clean hydrogen production at Darwin, together with associated carbon capture and storage infrastructure
- $247.1 million to support increased private sector investment in low emissions technologies including hydrogen, 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
Mr Taylor said with the Budget measures, the Federal Government has committed more than $22 billion of public investment in low emissions technologies by 2030.
In his Budget address speech, Federal Treasurer, Josh Frydenberg, said, “We are investing in clean hydrogen, carbon capture and storage, batteries and large-scale solar.
“We are making further investments in microgrids to support regional and remote communities that don’t otherwise have access to the grid with small-scale renewable energy projects like solar and wind.
“A low-emissions future with reliable and affordable power is critical to our plan for a strong economy.”
These measures in the 2022-23 Budget support the Federal Government’s Modern Manufacturing Strategy, Australia’s Long-Term Emissions Reduction Plan, the Technology Investment Roadmap and Low Emissions Technology Statement, National Hydrogen Strategy and Future Fuels and Vehicles Strategy.
The Clean Energy Council said that the 2022-23 Federal Budget missed the mark when it comes to cementing Australia’s place as a global clean energy superpower.
Clean Energy Council Chief Executive, Kane Thornton, emphasised the importance of infrastructure spending that supports a rapid transition to renewable energy over the next decade.
“Significant investment is required in the National Electricity Market and network to make this transition happen safely and smoothly,” Mr Thornton said.
“A 21st-century economy needs a modern electricity network that supports reliability, security and low-emissions technologies and delivers low-cost energy to consumers.
“The Federal Budget fails to look to the medium-to-long term future through an all-important lens of reducing the emissions that are having a devastating impact on the climate, the environment and on the lives of everyday Australians.
“The lack of transmission investment is now one of the most critical challenges facing Australia’s energy industry. Instead, yet another Federal Budget has prioritised the fossil fuel industry when Australia’s bottom line should be focused on providing a better future for communities through clean, low-cost renewable energy and storage.”
The use of microgrids and off-grid systems for rural and fringe-of-grid communities can improve safety and reliability while reducing energy costs and the Clean Energy Council said it welcomed the inclusion in the Budget allocation.
Australian Petroleum Production & Exploration Association (APPEA) Chief Executive, Andrew McConville, said the Budget has reaffirmed the long-term role of the oil and gas industry in Australia’s economy and lower emissions future.
“As noted by the Treasurer in his 2022-23 Federal Budget speech, Australia is on a pathway to net zero emissions by 2050,” Mr McConville said.
“Measures such as expanding the patent box concession for low emissions technology innovations, $300 million additional funding to support low emissions LNG, hydrogen production and associated carbon capture and storage infrastructure can help us continue to contribute to that pathway.
“Additionally, improvements to environmental regulation and planning for new infrastructure are all important to facilitating ongoing investment that will deliver more secure supply and cleaner energy.”