The Powering the Regions Fund is a $1.9 billion initiative under the Australian government's Powering Australia plan aimed at supporting regional Australia's transition to net zero emissions. It will be established using uncommitted funding from the Emissions Reduction Fund, Climate Solutions Fund, and Safeguard Mechanism Crediting.
Building on the previous two rounds of extensive consultation, industry and other stakeholders now have an opportunity to provide further feedback to the government.
Submissions close 5:00pm AEDT on Friday 3 February 2023 for the PRF.
The Fund will focus on supporting industry decarbonisation, developing new clean energy industries, and workforce development across regional Australia and will continue to purchase Australian Carbon Credit Units (ACCUs) on behalf of the Commonwealth.
Better Futures Australia recommends the Fund be delivered with a regional focus by working with state and local governments, communities and industry. Accessibility to funding should prioritise publicly committed decarbonising projects and job creation opportunities, while also considering factors such as workforce transition, community resilience and investment in Australian innovation. Support for the development of new clean energy industries should target zero carbon emission potential and adopt an ecosystem approach for hard-to-abate sectors. The Fund should support workforce development through the establishment of an independent statutory Just Transition Authority. We also note that publicly subsidising carbon offsets, or expensive ineffective technologies like carbon capture and storage (CCS) for coal and gas, would undermine the stated objective of both the PRF and the Safeguard Mechanism to reduce emissions and promote decarbonisation.
Thank you to our partners Beyond Zero Emissions, RE-Alliance, Sunrise and ACF for compiling guidance and recommendations included below to consider in making your own submission.
To the Powering the Regions team,
[Your name/organisation name] is writing in response to the Powering the Regions Fund (PRF) Consultation Update.
[Share why you are making a submission] We believe that the PRF has the potential to reduce emissions, create sustainable jobs, attract investment, and regenerate climate-resilient communities in Australia's industrial regions.
We would like to offer the following recommendations in response to the Discussion Questions:
How should the PRF best be delivered with a regional focus?
- The PRF should be delivered with a regional focus by collaborating with state and local governments, industry, and the community. Investment in renewable energy infrastructure, including support for renewable hydrogen and zero-emissions solutions, is crucial for decarbonising Australia's industrial ecosystem and supply chains. A number of regions including Gladstone, the Hunter Valley, Townsville and Bell Bay are already leading the way to future-proof Australian industry powered by low-cost renewable energy.
Objective 1: Decarbonising Existing Industries
Is there an approach to funding that will best allow the PRF to be accessible to the depth and the breadth of industry across Australia, and what factors beyond emissions reduction should be considered when assessing projects?
- Accessibility to funding should be based on job creation and emission reduction opportunities, prioritising publicly committed decarbonising projects. Other factors to be considered include collaboration, social license, First Nations involvement (refer to Best Practice Guidelines: Clean Energy Agreement Making on First Nations Land), workforce transition, industrial capability, and investment in Australian innovation. Factors such as deployable technology potential, difficulty of abatement, industry growth, and community impacts should also be considered, with emphasis on contributing to a national renewable energy grid.
Objective 2: Developing New Clean Energy Industries
Should support for the development of new clean energy industries be targeted towards specific sectors, regions, or stages of technology development?
- The PRF should prioritise support for new clean energy industries that have publicly committed to decarbonising and have zero carbon emission potential. In the short-term, money earmarked under the PRF for Safeguard Mechanism facilities should be subject to the transparency and reporting requirements of ARENA. For example, facilities must share their comprehensive net-zero transition plans to gain access through the Safeguard Transition Stream.
- For hard-to-abate sectors, an ecosystem approach should be adopted to facilitate collaboration and innovation sharing. The application of expensive technologies such as CCS to offset coal and gas developments, risks diverting investment away from real abatement and development of new renewable powered industries that will avoid carbon emissions in the first place. Scaling proven technologies, including pre-commercial proven technology, is crucial for reducing emissions and creating jobs in the regions. While experimental technologies may be viable to support transitioning hard-to-abate areas, support for such innovation will need to be in coordination with programs like ARENA. Community infrastructure and capacity to house a growing workforce without causing displacement should also be considered.
Objective 3: Workforce Development
What are the main challenges when it comes to workforce development and how should the PRF support workforce development?
- The PRF should support workforce development through the establishment of an independent Just Transition Authority to coordinate investment in workforce development across regions. The body should ensure that the voice of the community is heard alongside that of government, workers and industry. It will also need a long-term mandate to work with Jobs and Skills Australia to provide training programs, regional universities, and support for workers at retiring fossil fuel facilities.
Objective 4: Purchasing Carbon Credits
- We support the recent steps to improve the Australian Carbon Credit Unit (ACCU) scheme, but global best practice requires Australia to phase out fossil fuel subsidies and the use of carbon credits for coal and gas developments. According to the UN High-Level Expert Group Report, 'Integrity Matters: Net Zero Commitments by Businesses, Financial Institutions, Cities and Regions,' entities cannot claim to be net-zero while still investing in new fossil fuels and using carbon credits instead of reducing their own emissions. Purchasing ACCUs through the PRF undermines its objective and also risks Australia's bid to host COP31 with Pacific Island nations.
Thank you for considering our recommendations. We hope they will help to strengthen the PRF so that it plays a critical role in creating thriving, climate-resilient and zero emissions industries and sustainable jobs across regional Australia.
We look forward to the opportunity to further discuss our recommendations with your team. To arrange a meeting, please contact us at [email and phone number].
[Role and organisation]