The global race for cash for green hydrogen projects | The Business | ABC News

Summary

The Australian government's budget includes significant incentives to boost green hydrogen investment, positioning Australia as a global leader in renewable energy. With abundant solar and wind resources and strong trade links, especially with Asia, the country is well-placed to capitalize on the economic opportunity of decarbonization. The plan involves increasing renewable electricity, using green hydrogen in minerals processing and heavy industries, and extending tax credits for critical minerals processing. Despite opposition concerns, the government views these measures as a modest risk for substantial economic gains and job creation.

Takeaways

• 🌏 There is a global race to invest in green hydrogen, with significant incentives being put in place by countries worldwide.
• 🏁 Australia aims to be competitive in this race, leveraging its strong renewable resources and trading relationships with Asia.
• 💡 The ultimate goal is to decarbonize the economy, with a focus on using renewable energy to produce green hydrogen for various industries.
• 🔋 Australia currently has 40% of its electricity from renewables and is targeting 82% by 2030, indicating a clear path towards decarbonization.
• 🌿 Green hydrogen is seen as a key opportunity, not only for decarbonizing heavy industries but also for creating a competitive advantage globally.
• 💼 The government is offering tax production credits to companies processing critical minerals, indicating support for the value-added processing of these resources domestically.
• 📈 The financial risk for Australians is considered relatively low compared to the potential for a large economic return from these investments.
• 🏭 There is an opportunity to transform Australia's economy from a 'digg and ship' model to one that processes and uses minerals for end products locally and for export.
• 🤝 The government's incentives are seen as partnerships with industry, aiming to create jobs and set up new export industries.
• 🛑 The opposition's stance to block these measures is viewed as a potential obstacle, with the government expressing hope that the economic opportunity will be recognized.
• 🌱 The incentives are justified as part of a broader policy response to a global challenge and opportunity, with long-term economic benefits in mind.

Q & A

What is the global race mentioned in the script about?

The global race mentioned in the script is about countries investing in green hydrogen and decarbonizing their economies, with significant efforts being made in Europe, North America, and the United States.

Why does the Australian government's budget commitments ensure the country is back in the race?

The Australian government's budget commitments ensure the country is back in the race due to its rich renewable resources, strong trading relationships with Asia and other parts of the world, and measures that leverage its competitive advantage.

What is the ultimate aim of the countries involved in this race?

The ultimate aim is to win the race by decarbonizing their economies and taking advantage of the economic opportunities presented by green investments, job creation, and innovation in clean energy technologies.

What percentage of Australia's electricity comes from renewables currently, and what is the target for 2030?

Currently, 40% of Australia's electricity comes from renewables, and the country is aiming to increase this to 82% by 2030.

How does the speaker describe Australia's position in terms of renewable resources?

The speaker describes Australia as a 'truly lucky country' with some of the best wind and solar resources in the world, as well as possessing critical minerals necessary for the energy transition.

What is the government's approach to incentivizing the processing of critical minerals in Australia?

The government is extending tax production credits to companies that process critical minerals, aiming to transform Australia's economy from a 'digg and ship' model to one that processes and uses these minerals for end products in the Australian market and for export.

What is the level of financial risk Australians are being asked to accept according to the speaker?

The speaker believes that the level of financial risk Australians are being asked to accept is relatively low for an enormously large return, given the potential economic opportunities.

What is the government's justification for taking on equity in individual projects?

The government's justification for taking on equity in individual projects is to respond to the global challenge and opportunity with a range of policies that level the playing field and attract investment, ultimately benefiting the Australian economy.

How does the speaker respond to the criticism that the policy delivers billions in handouts to billionaires?

The speaker refutes the criticism by stating that the policy is not about handouts but about providing incentives in partnership with industry to create jobs and set up new export industries, which will benefit the Australian economy in the long term.

What is the speaker's view on the opposition's vow to block these measures?

The speaker expresses hope that the voice of reason will prevail and that those who want to play politics will consider the long-term implications for the Australian economy if these measures are stopped.

What role does the speaker believe the government should play in this economic transition?

The speaker believes there is a significant role for the government in supporting the transition to a green economy through smart and sensible policy measures that attract investment and create opportunities for manufacturing, clean energy production, and other industries.

Outlines

00:00

🌏 Global Race for Green Hydrogen Investment

The script discusses a global competition among countries to invest in green hydrogen, with a focus on Australia's position in this race. The Australian government's recent budget includes significant incentives to encourage green hydrogen investment, leveraging the country's excellent renewable resources and strong trading relationships. The aim is to decarbonize the economy, particularly by increasing the use of renewable energy to produce hydrogen for minerals processing and heavy industries, thereby giving Australia a competitive edge in the global market. The government is also offering tax credits to companies involved in processing critical minerals, which is seen as a low-risk, high-return opportunity for economic growth and job creation.

05:00

💼 Economic Opportunities and Government Support

This paragraph delves into the economic opportunities presented by the global shift towards decarbonization and the potential for Australia to capitalize on it. The government's role is emphasized through the provision of incentives and support, including tax breaks and equity participation in projects. The speaker argues against the notion that these measures are 'handouts', instead framing them as partnerships with industry to create jobs and establish new export industries. The response to criticism from the opposition, who may block these measures, is hopeful, with an emphasis on the long-term benefits for the Australian economy and the importance of taking advantage of the current opportunity.

Keywords

💡Green Hydrogen

Green hydrogen refers to hydrogen gas that is produced using renewable energy sources such as wind, solar, and hydroelectric power. In the video's context, it is central to the global race for decarbonization and economic opportunity. The script mentions that countries are investing in green hydrogen to reduce carbon emissions and Australia's advantage in renewable resources positions it well in this race.

💡Decarbonization

Decarbonization is the process of reducing or eliminating the emission of greenhouse gases, particularly carbon dioxide, from various sectors of the economy. The script emphasizes the challenge and opportunity for countries to decarbonize over the next few decades, with Australia aiming to lead by leveraging its renewable resources and green hydrogen.

💡Renewable Energy

Renewable energy is energy derived from natural resources that are replenished on a human timescale, such as sunlight, wind, and rain. The script highlights Australia's abundant renewable resources as a competitive advantage in producing green hydrogen and decarbonizing its economy.

💡Economic Opportunity

Economic opportunity refers to potential for economic growth, job creation, and investment. The video discusses how the transition to green energy and decarbonization presents an extraordinary economic opportunity for countries that can capitalize on it, with Australia being particularly well-positioned.

💡Critical Minerals

Critical minerals are elements essential for modern technologies, including those used in clean energy applications such as batteries for electric vehicles and renewable energy storage. The script mentions that Australia has a lot of these minerals, which are crucial for the country's economic future and its ability to process and export high-value products.

💡Minerals Processing

Minerals processing involves the treatment of mined material to improve its value through physical or chemical means. The video script discusses the opportunity for Australia to process its critical minerals domestically, creating higher-value products and economic benefits.

💡Tax Credits

Tax credits are incentives provided by governments to encourage certain activities, such as investment in new technologies or industries. In the script, the Australian government is extending tax production credits to companies processing critical minerals, which is part of the strategy to boost the economy and support the transition to green energy.

💡Financial Risk

Financial risk is the possibility of losing money on an investment or business venture. The script discusses the level of financial risk Australians are being asked to accept with government intervention, suggesting that the risk is relatively low compared to the potential economic return.

💡Equity Investment

Equity investment refers to owning a portion of a company, usually in the form of shares. The government's taking on equity in individual projects, as mentioned in the script, is a way to support and share in the risk and reward of developing new technologies and industries.

💡Policy Measures

Policy measures are actions taken by governments to address specific issues or achieve certain goals. The script refers to a range of policy measures implemented by the Australian government to level the playing field and attract investment in clean energy and green technologies.

💡Political Opposition

Political opposition refers to parties or individuals that disagree with or challenge government policies or actions. The script mentions the opposition's vow to block certain measures, highlighting the potential obstacles to implementing the government's vision for economic and environmental progress.

Highlights

Global race on countries to invest in green hydrogen

Australia has competitive advantage with best renewable resources

Strong trading relationships with Asia to leverage green hydrogen

Decarbonizing economy is ultimate aim to win the race

Australia has best wind and solar resources, capable industry

Government extending tax credits for critical mineral processing

Low financial risk for large return from government intervention

Opportunity to process minerals in Australia for end products

Government taking equity in projects to justify risk

Different countries responding with various policies to opportunity

Australia well positioned with incentives for manufacturing, green steel, batteries

Incentives justified for long-term economic opportunity

Opposition may block measures, impact on economy if not implemented

Government measures are right thing to do in partnership with industry

Voice of reason needed in Parliament to support measures

Transcripts

there is a global race on countries

around the world including throughout

Europe North America and the United

States most significantly have' put in

place enormous incentives to encourage

investment in green hydrogen into their

countries and this step these

commitments from the Australian

government in this budget ensure that

we're back in the race we've got some of

the world's best renewable resources uh

we've got a lot of strong trading

relationships with Asia and other parts

of the world to take advantage of this

and these measures make sure we're back

in the race and can take advantage of of

our competitive Advantage is the

ultimate aim to win that race well it

absolutely is this is uh this is an

extraordinary opportunity the challenge

for the world is to decarbonize all

parts of their economy over the next

couple of decades it is a race there's

extraordinary Economic Opportunity in

jobs investment in economic activity to

the countries who get it right and

Australia we are truly Lucky Country

we've got some of the best wind and

solar anywhere in the world uh we've got

some extraordinarily capable industry

we've got a lot of the critical minerals

we can bring all this together there's

no doubt we can win this race does

winning mean decarbonizing the economy

first yeah I think we need to do a

number of things first is to decarbonize

our economy we've got a shift and we're

on that Journey we've currently got 40%

of our electricity coming from

Renewables we're heading towards 8 2% by

2030 that's a really important step but

then it's taking advantage of the green

hydrogen opportunity using that

renewable energy to produce hydrogen to

have that feed into our minerals

processing into our heavy Industries to

decarbonize those sectors so they can

compete globally and out compete those

other countries that aren't blessed with

the same renewable resources we are the

government is also extending tax

production credits to companies

processing critical minerals

how would you categorize the level of

Financial Risk Australians are being

asked to accept with this level of

government

intervention well I think it's a

relatively low risk for an enormously

large return we are world renowned for

our mineral resources we've got really a

digg and ship economy if you like at the

moment and the big opportunity for us is

to go further to process those minerals

here in Australia uh to ultimately use

them as end products here in the

Australian Market whether that's uh

producing batteries or green steel

there's clearly a big opportunity for us

to do that here in Australia and then to

export those products internationally

there's a big return if we get this

right and I think these steps from the

from the government are relatively

modest modest level of risk for an

enormous Economic Opportunity there is

more support than just the tax breaks in

some cases the government will be taking

on equity in individual projects what

what is the justification for that kind

of

risk well I think what we're seeing

around the world is every country

responding to this Challenge and

enormous opportunity with a wide range

of different policies and it's no

different here in Australia we can do

nothing we can sit and let the market

rip and ultimately investment will go to

those other countries or we can do what

this government is doing which has put

in place a range of I think quite smart

and sensible policy measures that level

the playing field that will ultimately

mean that investment and whether it's in

manufacturing some of the critical clean

energy components whether it's producing

green steel whether it's manufacturing

batteries all of these things are

massive opportunities for Australia uh

it's hours to lose uh and I think these

incentives that the government's putting

in place are clearly Justified given the

Economic Opportunity not just for now

not next year not 10 years but for many

decades to come what's your response to

the shadow treasurer's view that this is

a policy that will deliver billions in

handouts to

billionaires well F firstly this this

isn't handouts this is a package of

incentives in partnership with industry

we've got some very mature sophisticated

businesses that are prepared to invest

in these projects by that investment

they will create many tens of thousands

of jobs in Rural and Regional Australia

and they'll set us up to have export

indust Industries which will replace our

old fossil fuel parts of the economy

create jobs create investment and a

strong economy for many decades to come

and you know the reality is these are

these are sophisticated companies these

are complex projects and in partnership

with government there's no doubt this is

the right thing to be doing the

opposition has vowed to block these

measures do you see that as a potential

obstacle to these supports being

implemented or are you confident that

the Senate crossbenchers will back it

look we're we're certainly hopeful that

the voice of reason Prevail I think what

we need to ask ourselves and those

people who uh want to play politics and

get in the way of this is if they stop

these measures what does that mean for

the Australian economy in 5 years in 10

years and in 20 years time because this

is The Economic Opportunity of the globe

this is the opportunity that Australia

is very very well positioned to take

advantage of there is a role for

government

uh and I think these are the right

measures to to get behind him back and I

hope the voice of reason Prevail in the

Australian Parliament K Thornton thanks

for your time thank you