Federal Budget 2020-21

What does it means for the Energy Industry?

On 6 October 2020, The Federal Minister for Energy and Emissions Reduction, The Hon. Angus Taylor MP, stated "Our 2020-21 Budget initiatives will help to lock in lower energy prices while simultaneously developing the backbone of a reliable, lower emissions National Electricity Market (NEM) for the next decade and beyond.

"As we rebuild from the COVID-19 pandemic, the Government will also accelerate the development of low emission technologies to help reduce emissions, strengthen energy security and support jobs." 
 

The Energy Industry

Minister Taylor's announcement stated the following initiatives would be implemented in this financial years budget: 

  • Up to $250 million to accelerate major transmissions projects, including Marinus Link, Project EnergyConnect and VNI West, combined with the existing support for HumeLink and the QNI Interconnector.
  • A $53.6 million microgrid program to help support the development of pilot projects in regional areas to deliver more affordable and reliable power to regional communities in Australia.
  • Connecting the North West Minerals Province (NWMP) near Mount Isa to the NEM for extra support to the CopperString high voltage transmission line.

Supporting Documents

> The Hon Angus Taylor MP Media Release
> The Hon Josh Frydenberg MP Budget Speech transcript
> Department of Industry, Science, Energy and Resources 2020-21 Budget Portfolio 

Useful Links for Financial Support & Grants

> Government Rebates, Grants and Programs for Businesses
> Energy Rebates and Assistance, 
   including additional support relating to COVID-19

 

The Role of Gas in Australia's Economic Recovery Plan

"More gas at a lower price will support jobs in Australia's manufacturing sector. …Affordable and reliable energy will be critical to Australia's future economic prosperity," says Treasurer Josh Frydenberg in his Budget speech.

Gas is set to play a huge role in the economic recovery plans set out by the Federal Government. The announcement on 15 September 2020, of an inaugural National Gas Infrastructure Plan (NGIP) was made to identify priority infrastructure projects and boost the Wallumbilla Hub into the Australian Gas Hub, making it more transparent and in a similar vein to the Henry Hub in the United States.

More information is still to be released, but the media release expands on the Gas-Fired Recovery plan. The Budget specifically referenced:

  • $42 million of investments will go towards unlocking further gas supply.
  • $10.9 million will be invested to strengthen gas infrastructure planning and deliver market reform to lower the price of gas for households and manufacturers.
"Make it Happen": The Australian Government’s Modern Manufacturing Strategy
Gas will also play an essential role in the $1.3 billion Modern Manufacturing plan. The backbone of this plan enables businesses to be globally competitive through cheaper and more reliable energy. The six national manufacturing priorities being targeted for this are:
  • Food and beverage manufacturing
  • Resources technology and critical minerals processing
  • Medical products
  • Recycling and clean energy
  • Defence industry
  • Space industry
 

Reducing Emissions

The Budget also set out measures to demonstrate how the Government is utilising technology to reduce emissions. These measures include:

  • $1.4 billion over the next 10 years for the Australian Renewable Energy Agency to support the Government's Technology Investment Roadmap
  • $70.2 million over five years to activate our nations first regional hydrogen export hub and to facilitate research collaborations and international supply chain studies to boost Australia's hydrogen industry.
  • $95.4 million for a Technology Co-Investment Fund to implement recommendations from the King Review to support businesses in the manufacturing, industrial, transport and land sectors to invest in low emissions technologies to unlock energy and emissions savings and create jobs.
  • $50 million investment in the Carbon Capture Use and Storage Development Fund to dramatically cut emissions from large industrial facilities
  • $74.5 million over four years to enable Australian consumers and businesses to adopt future fuel/vehicle technologies in Australia, including hydrogen, electric and bio-fuelled vehicles.
  • $45.2 million for Government to progress reforms to make it easier and cheaper for businesses to participate in the Emissions Reduction Fund, and to support investment in offshore clean energy generation and transmission.