Australia wants to become a renewable energy superpower. Can I?

Hidden among the thick bush on the outskirts of southern Sydney is a vast structure housing a technological breakthrough.

It’s here that the Australian company SunDrive Solar produces its “special sauce”: a new formula – top secret – that it says has solved “a very high value problem”.

Its big innovation? Finding a way to replace the silver used in solar cells with copper, which was previously thought impossible.

“Silver is expensive, scarce and environmentally disastrous and limits the amount of solar energy that can be distributed around the world,” explains Chief Commercial Officer Maia Schweizer.

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

The start-up is one of the beneficiaries of the government’s Future Made in Australia plan – a set of policies aimed at turning the country into a “renewable energy superpower” by investing in the country’s green industries.

But some experts question whether the $22.7bn ($15bn; £11.8bn) package – which includes tax incentives, loans and start-up grants – is enough to meet those lofty ambitions.

And climate scientists say if Australia wants to be a major player in the net zero transition, it needs to stop selling fossil fuels.

Australia’s economy has long been powered by its natural resources, such as coal, gas and iron ore.

But its critical minerals – many of which underpin essential low-emissions technologies – are exported unprocessed and refined abroad, mainly from China.

It’s a trading model that has given Australia a reputation as the world’s quarry and seen it miss out on a significant chunk of change further up the supply chain.

Lithium – which is used in batteries that store renewable energy and power electric vehicles – is one example.

Despite being responsible for more than half of the world’s supply, Australia only captures 0.5% of global supply $57 billion lithium battery market, according to the country’s national science agency.

The Future Made in Australia policy – which was officially announced in April – seeks to change that, offering tax breaks and credits to companies looking to process critical minerals at home.

Doing so, the government argues, is a national security priority as countries examine their trade dependence on Beijing and seek to insulate themselves against supply chain shocks.

“This is not old-fashioned protectionism or isolationism – it’s the new competition,” Prime Minister Anthony Albanese said when he announced the plan.

“We must aim high, be bold and build big to match the magnitude of the opportunity before us.”

Queensland-based Alpha HPA is one of the companies the government has tapped to execute its vision.

Like SunDrive, it sees itself as a disruptor, due to its ability to create ultra-high-purity aluminum products — used in things like semiconductors and the iPhone — with a lower carbon footprint than outside competitors. the state.

Thanks to a $400 million federal loan, it is building one of the world’s largest aluminum refineries near the coastal town of Gladstone, which it says will create hundreds of local jobs.

It’s a huge source of pride, given there’s still skepticism about whether Australia can get things done, after decades of outsourcing its manufacturing to China, says Alpha HPA chief operating officer Rob Williamson.

“Anyone who makes the case that we don’t have people in this country to do [this work] it’s 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 is looking to transform one of the nation’s oldest coal-fired power plants 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 produced domestically – with China responsible for more than 80% of global production.

“Every single mineral you need to make a solar panel, we have one of the three best reserves in the world,” Ms Schweizer explains.

“Now there’s an opportunity for the end-to-end value chain to hit the ground running 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 investment can be “The Game Changer”.

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

But some climate experts warn that it is being “severely undermined” by the government’s latest decision on it sample gas until 2050 and beyond despite global calls for a rapid phase-out of fossil fuels.

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

“This government has continued to approve new gas and coal projects – it has been sent 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 constantly looking for customers for our fossil fuels,” she says.

One of the country’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 reports on climate change.

“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 by her thinktank, last year alone state and federal governments spent $14.5 billion subsidizing fossil fuel use across Australia, and that amount is only expected to rise, according to budget estimates.

In contrast, she says the A$13.7 billion invested to process critical minerals and incubate Australia’s birth green hydrogen industry “isn’t real money”.

This is because it will take the form of tax relief over a decade, which can only be cashed for production starting in 2027 – a model that policymakers say will ensure taxpayers’ money is not wasted.

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

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

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

Some energy experts have also cast doubt on the business rationale behind green hydrogen – given that the industry is still in its infancy and full of unknowns.

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

But Mr. Grimes says green hydrogen will play a crucial role in “stripping emissions” from Australia’s carbon-intensive mining sector – as companies seek cheap green sources of fuel to continue powering their operations.

And the bigger picture, he argues, the government’s new green investments should be seen as “a historic first step” rather than an end point.

“The government knows that unless it moves beyond its coal, gas and iron ore exports soon, Australia risks becoming the Kodak economy of the future: a big deal one day and completely irrelevant the next.”

Australia is not the only country seeking to position itself as the engine of the new green economy.

Dozens of countries are putting forward ambitious proposals, such as the European Union’s Green Deal or America’s giant Inflation Reduction Act.

Globally, policymakers have already invested over US$2 trillion in clean energy initiatives since 2020, according to the International Energy Agency.

But Australia has some compelling natural advantages, such as enviable wind and solar capabilities, deposits of critical minerals and rare earths, and a strong network of reusable mining infrastructure.

If used properly, all the experts the BBC spoke to agreed that it has every chance of securing its place as a critical green trading partner among the Allies.

However, they say getting there will require even greater investment – particularly in research and development, which is currently Lowest levels in 30 years.

And they have warned that the government cannot afford to drag on – a point which Mr Albanese himself has addressed head on.

“We have to crack. We have unlimited potential, but we don’t have unlimited time.

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