This is a squeeze podcast where you're short cut to being informed.
There's been a lot of talk about the Albanese government's future made in Australia policy
since it was unveiled in the budget. Put simply, it's the government's roadmap to turn us
into a renewables superpower, but not everyone's convinced. So, as we head towards an election,
dominated by the energy debate, in this squeeze short cut, we will take a look at what the future
made in Australia policy is, how it'll work, and why everyone's talking so much about critical minerals.
Squeeze Shortcuts is the backstory to the big news stories. I'm Larissa Moore, and I'm Shivon
Moore and McFarlane. Shivon Energy is a hot topic in Australia. There's always plenty on our
energy mix in the news, and as a country, we are in the process of changing the way that we generate
our power. Yeah, so we're moving away from relying on fossil fuels like coal and gas to more
renewable sources like solar and wind. But Larissa, there's a lot of niggling questions about how
we're going to do that. Yeah, the big question of how. So, we know the coalition has put nuclear
energy on the table. As an answer, we've talked a lot about that in the squeeze today podcast,
and we did a recent short cut on it too. But in this particular short cut, we are going to take
a closer look at the Albanese government's policy when it comes to energy, and that is their
plan for a future made in Australia. Yeah, it's a catchy name, isn't it Larissa? Yeah, but what it
actually means is that the government wants to turn Australia into a renewables superpower,
and that's by investing a whack of money into building our own stuff in that space,
and also processing the natural resources that we have in the ground instead of sending them overseas.
Yeah, so we're talking about manufacturing our own solar panels, batteries and wind turbines,
as well as growing our green hydrogen industry. We'll get into that a bit more in a sec.
Also, Australia has an abundance of critical minerals, so the question is how we turn that into
big business? Yeah, and another element of the plan to mention is helping us reach our emissions
reductions targets, while making sure that we're not overly reliant on supplies from overseas.
Yeah, these energy transitions are happening all around the world, and if Australia is leading the
way, the government's thinking is that we will be in a prime position to make the most of these
opportunities as more countries change over to renewables for their power. So part of the plan
is also designed to meet that growing global market. Yeah, so just to remind people, the Albanese
government is aiming to reduce our greenhouse gas emissions by 43% by the year 2030,
and that would see the majority of our energy being generated by renewables.
And if that target is ringing a bell, that is because it's the one the coalition
set a couple of weeks ago that they're going to ditch if they're elected.
Shavon, the big goal that both Labour and the Coalition remain committed to, is the one that we
signed up to back in 2016, and that's the one that's known as the Paris Agreement.
Yeah, and that's to reduce our emissions to net zero by 2050, which means that the greenhouse
gases we produce and the pollution we've taken out of the atmosphere are neutralised.
And the stats say we are making good progress, Larissa.
They do. Renewables accounted for nearly 40% of our total energy use last year,
but when you think about it 2030 is not far away, six years?
No, it's not far at all. So that's why in the May budget,
the government revealed its future made in Australia policy,
which is designed to support and encourage Aussie businesses in the renewables space to help us
reach our emissions goals faster. So by support, we're talking about things like tax incentives
for businesses that manufacture those products that we mentioned before, solar panels and the like,
all the things that are needed to generate renewable energy.
And PM Anthony Albanese says it's a strategy that will not only help with our climate targets,
but it'll also boost our economy with jobs and attract investment from overseas.
And Larissa, the amount we're talking about is not chicken feet.
No, nearly 23 billion dollars. So it is a major investment.
The Prime Minister has taken this direction, Shivon, for a couple of reasons.
Yes, so he's taken note of what's been happening in the US and Europe,
where their governments have plowed hundreds of billions of dollars into clean energy.
Yeah, and a lot of these funds have gone into the creation of green businesses.
So these have helped those countries to considerably reduce emissions in the past five years,
according to climate research. They've also lessened their reliance on China for renewable
ingredients like refined critical minerals. Now, Larissa, our government wants to build up Aussie
industries in the area of green hydrogen and critical minerals in much the same way.
And this is where the policy starts to get really interesting.
So up next, we'll look at why green hydrogen and critical minerals are a major,
major part of it. And how building up those industries is important for our security.
Shivon, the Future Made in Australia fund, aka FMA, is a big bold policy.
The government is really trying to set a roadmap for how we can achieve our climate targets,
while also positioning Australia as a key global player in renewables.
And, showing up our security, as we mentioned before, there's a couple of main pillars to it all.
Yeah, so one of those is producing our own green hydrogen. And if you're not familiar with
green hydrogen, it's basically hydrogen that's made using only renewable power.
Yeah, we're going to get into a couple of definitions here. Green hydrogen is made when
electricity from renewables is used to split water into parts of hydrogen and oxygen.
And then that hydrogen is captured and used as fuel.
And when it's burned, the only byproduct is water. And that makes it an entirely clean fuel.
Larissa, the government says it's a game changer because it opens the door to us being a world leader
in the production of green metals. So we're talking about things like iron, steel,
alumina and aluminum, which are going to play a vital role in decarbonising big industry as the
whole world heads towards net zero. And because Australia is already a world leader in steel and
metals, using green hydrogen to produce green metals means we can actually make a big difference
to the world's total emissions. Exactly. And that's because we'd be helping to cut out 13% of the
entire world's emissions that are made through metal production. So Australian companies are being
incentivised to produce green hydrogen with things like tax credits. That's one part of the FMIA
policy. Yeah, so another area where Alpenese wants to see us level up is in critical minerals,
where global demand is expected to increase by around 350% by the year 2040. But Larissa,
we should probably explain what we mean by critical minerals. Yeah, I said there'd be a couple
of definitions here. So they're called critical minerals for two reasons. One, because they're
essential for making green technologies like solar panels, rechargeable batteries that are used
in electric vehicles and the wind turbines that are used in wind farms. Right. And the other reason
is that there's a risk that their supply chain could be disrupted due to the dominance of one
country world unrest. Or let's say a pandemic. So each country has its own list of critical minerals,
which it works out according to demand and the potential risks to their supply. Did not think
that pandemics would make an appearance in a short kind of critical minerals, but here we are.
In Australia, we have 31 critical minerals on our list, and they include copper, nickel, cobalt,
lithium, and rare earth elements. And Australia is already a major player in this field,
because we're really rich in all of these minerals. Yeah, we are already the largest producer
of lithium in the world. And we have some of the biggest natural deposits of copper, nickel,
and rare earth minerals on the entire planet. But currently, a lot of what we mind is
sent overseas for refining, mostly to China, which processes 60% of the world's critical minerals
for the renewables market. So if we step up our own refining facilities here, it means we will
be less reliant on China. And then we'll also be in a position to sell them to overseas buyers,
like the US, the European Union, India, Japan, South Korea, and the UK. The government is offering
tax incentives of 10% on processing and refining costs for companies to start doing that.
Exactly. So building our own industry and supply chain here is something the government really
needs to happen, because our renewable energy supply, frankly, depends on it. Yeah, the budget
papers openly state that we want to shore up our security because of the increasingly unstable
situation in the world. And analysts have said that it'll mean we still have a market for our
resources. If, for instance, tensions between China and the US ever boil over and we would be forced
to choose a side. Yeah, Larissa, it's a really tricky dance that we're in with China.
And it was only recently that Chinese Premier Li Chang visited Australia. And in between talking
about pandas, he toured a partly Chinese-owned lithium processing facility in Western Australia.
Yeah, China has made no secret of the fact that they want to invest more in Australia's
critical mineral industries, but that is something that comes with complications.
Yeah, and that's because of our alliance with the US, which is in fierce competition with China.
The US has been a big supporter of Australia building an alternative supply chain in order to
weaken China's stronghold on renewables. There is a lot to the FMAA policy. Shivon, we haven't yet
talked about the plan to invest in emerging technologies like AI, robotics, and quantum computing.
Yes, and the governments put all the details in a building.
they've introduced to Parliament this week, so we will be able to see all of the nitty-gritty
very soon. It is fair to say, though, that the reaction from the community has been mixed.
The coalition for one is not on board with the FMIA. No, so coalition leader Peter Dutton says
the government shouldn't be using taxpayer dollars to prop up emerging industries. He says the
private sector should fund them and they should be able to stand alone. Yeah, he said that in offering
tax credits to the mining industry, the government would be, and these are his words, giving handouts
to billionaires. Yeah, he also said the plan is peddling false hope, and that's because high
local manufacturing costs could drive up energy prices, adding to cost of living pressures.
And if the coalition opposes the legislation, the government is going to need the support of the
Greens and cross benches for it to pass. And the Greens aren't convinced about it yet either. They
are worried the government is relying heavily on gas, which is a fossil fuel, to prop up gaps
in the energy grid during this transition to renewables. Yeah, the old gas strategy, not very
popular with the teals in the lower house either, they've said that they'll need to see the fine
print for the FMIA before they give their support. Then we come to industry bodies. It's not much
of a surprise to have on that industry bodies in renewables think that the FMIA sounds great.
Yeah, particularly in relation to the incentives on offer in mining, the association of mining
and exploration companies CEO Warren Pierce said the critical minerals tax incentive is a policy
setting that will get Australia back in the game on a global stage as other countries look to
shore up their own supply chains. Now that was his quote. So no doubt these are some of the issues
that we will be talking about more as we get further into the energy debate and closer to the
next election. That's our short cut to the future made in Australia policy and critical minerals.
Now onto our recommendations.
Each week we like to give squizzes recommendations for further reading, watching and listening
on the topic. Mine is an ABC news daily podcast called Can Australia really afford to make stuff?
I found it gave a really good insight into some of the challenges the government might face
with its FMIA plan. It's a 15 minute listen. You know we love a short form podcast. It lays out
what the government is planning and looks at whether they can pull it off. Yeah, nice one.
And I've got an article published in the conversation called Critical Minerals for the World
or Just for the US, turning Australia into a green minerals powerhouse comes with risks.
And that also gives a really good summary of Australia's predicament when it comes to critical
minerals. I'll put links to both of these in the episode notes of course. Shave on this was our
first ever short cut to get. I know it's a really enjoyed it. Yeah, love doing it with you. Alice
will be back next week. Thank you for listening and remember, share this episode with your mates if
they are asking a lot of questions about the energy mix, about critical minerals, about renewables.
It's a good one to get the backstory to the big news stories. And if you've got a sec and you're
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And we can take a look at your suggestions. Until next time.
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