Big spend on clean energy, but households need more than bill relief sugar hit

The Albanese government is being hailed for delivering the biggest spend on clean energy in Australia’s history, in a federal budget that climate and renewable energy leaders say marks a significant turning point for an economy long shackled to the fortunes of coal and gas.

However, no new funding was provided for household electrification, which is broadly considered to be a no-brainer to cut emissions, reduce gas consumption, and cut the cost of living in a much more meaningful, lasting, and faster way than the one-off $300 bill discount it has allocated for all households, regardless of income.

Federal Treasurer Jim Chalmers has announced $21 billion of new funding initiatives under the Future Made in Australia Act strategic framework as part of the 2024-2025 Federal Budget, including nearly a $14 billion boost to the critical minerals and green hydrogen sectors, through production tax credits.

The Australian Renewable Energy Agency also got a $5.1 billion boost, including $1.5 billion to support solar and battery manufacturing and $1.7 billion for an innovation fund for industries such as green metals and low-carbon liquid fuels.

Elsewhere there was spending on battery storage development, green jobs, project development and approval reform, First Nations participation, and climate and energy diplomacy.

However, whilst these efforts are seen as critical steps towards electrification, the lack of direct funding to electrify homes and transport is seen by many groups as a lost opportunity.

Virtually nothing has been allocated to electrifying transport, despite the Department of Climate Change, Energy the Environment and Water (DCCEEW) projections that show transport will be the highest emitting sector in Australia by 2030.

Support for more Australians to access household solar and batteries would have provided decades of energy bill relief, replace aging coal-fired power plants, and circumvent the need to invest in more fossil gas.  

“This Federal Budget recognised energy bills are an important form of cost-of-living relief, yet missed the opportunity to provide households and small businesses with longer-term relief through greater support for rooftop solar and household batteries,” says Solar Citizens CEO Heidi Douglas.

“While we acknowledge many Australians will be seeking immediate power bill relief, government support for solar panels and home batteries would continue to deliver savings for up to 20 years.”

Solar Citizens says a “new burst” of federal government investment in rooftop solar is also missing from the budget.

“Rooftop solar provides the most economical possible energy to customers and everyone in Australia should have access to the cost-saving benefits of solar, regardless of their postcode, or whether they rent or live in an apartment or social housing,” Lee says.

Rewiring Australia, too, says more work needs to be done to bring households to the centre of energy and climate policy.

“That is the fastest, most cost-effective way to reduce energy bills and help households move off dirt, fossil fuel gas onto cleaner, cheaper solar-generated electricity,” says Rewiring Australia executive director Dan Cass.

“The next step on Australia’s journey to Net Zero is for the Australian government to create a low-cost loan scheme for the millions of Australians who cannot afford the up-front investment to ditch expensive gas and petrol for cheap and healthy solar, EVs and electric appliances.

“This will be central to any credible climate policy at the next election and has unparalleled support across the political spectrum and broader community.”

In its pre-budget submission to government, Rewiring Australia proposed a low-cost HECs style loan scheme, similar to the student higher education funding scheme, that would only need to be repaid on the sale of a property.

On social licence, advocacy groups are calling for governments to extend their clean energy budget ambition to the cause of building trust with regional communities who are critical partners in the transition.

RE-Alliance and Community Power Agency note that their call for a federally funded network of 50 independent Local Energy Hubs in regions with large amounts of current or proposed renewable energy developments and transmission lines, was not answered in the budget.

“$10 million over two years, that will include delivery of public information on the net zero transition, is something we’ve been calling for and will help inform regional communities,” says RE Alliance national director Andy Bray.

“We have a once-in-a-generation opportunity to ensure that the shift to renewables delivers logical, local, long-term benefits for farmers, local councils and regional communities,” Bray says.

“We can see a $20.7 million commitment to improving community engagement and community benefits which is really promising. …This is a start but we’re hopeful the government will up their ambition in building trust in the regions by the time we get to the mid-year budget update.”

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An earlier version of this article was first published by RenewEconomy. You can read it here.