28 October The low emissions technology investment roadmap October 28, 2020 By Sally Parker General, Resources and Energy, Technology Emissions, Technology, Investment 0 On 22 September, the Minister for Energy and Emissions Reduction released the first Low Emissions Technology Statement (the Technology Statement). The document clearly shows the Government is moving away from subsidising wind and solar as the technology matures, and looks to support new and emerging technologies that will lower emissions in Australia. According to the Minister, the Technology Statement also focuses on reducing cost and creating jobs. The 2020 Technology Statement focuses highlights the following five priority technologies: 1. Hydrogen: It is estimated that the domestic hydrogen industry could generate over 8,000 jobs and $11 billion in GDP by 2050. The focus is on scaling the industry quickly and cost effectively while reducing input and capital costs. Initiatives include creating a regional hydrogen export hub, funding for research and development and the stimulation of domestic hydrogen demand. The Department of Industry, Science, Energy and Resources has also indicated that it will produce a reputable certification and guarantee of origin scheme for hydrogen to facilitate trade opportunities. 2. Energy Storage: This is key to facilitating low-cost solar and wind electricity in the grid, providing system security services and having a source of reliable, dispatchable electricity. There is a need to have a mix of storage options from pumped hydro to batteries and solar thermal energy storage. 3. Low carbon metals production (like steel and aluminium): These are important global commodities that already employ thousands in Australia, but more can be done to reduce cumulative emissions while increasing economic activity and jobs. Emerging technologies focus not only on steel and aluminium production, but could also reduce upstream emissions in iron ore mining and alumina production. 4. Carbon capture and storage: CCS underpins new low emissions industries and provides the potential for decarbonisation of other industries like natural gas processing and cement. The initiatives include establishing a Deployment Fund to support new and emerging technologies and finalising the Emissions Reduction Fund methods to support carbon capture and storage and soil carbon; and 5. Carbon soil sequestration: Improving land management practices in crop and grazing lands can reduce CO2 in the atmosphere and improve agricultural productivity and soil resilience. Initiatives include a soil carbon innovation challenge to rapidly reduce the cost of measuring the impact of new farming practices on soil carbon equestrian. The document also outlines stretch targets for each of these priority areas including: ● producing clean hydrogen under $2 per kilogram; ● enabling long duration (at least 6 hours) energy storage at under $100 per MWh to match wholesale electricity on price; ● low emissions steel production under $900 per tonne and low emissions aluminium under $2,700 per tonne; ● CO2 compression, hub transport and storage for under $20 per tonne; and ● soil carbon measurements under $3 per hectare per year, representing a reduction of 90%. While the Government will invest in the industry, it expects lower emissions technologies to be funded primarily by the private sector. The expectation is for every dollar invested by the public purse $3-$5 (depending on the technology) will come from private enterprise. If this isn’t achieved, further prioritisation of affected technology may occur. This equates to almost $50 billion by 2030, with the Government footing the bill for an additional $18 billion. These initiatives are expected to support 130,000 jobs by 2030 and avoid up to 250 million tonnes of emissions by 2040. The majority of the Government’s investment will be in expanding the role of clean energy agencies including the Australian Renewable Energy Agency (ARENA) and the Clean Energy Finance Corporation (CEFC). In the future, Technology Statements will be updated by the newly established Technology Investment Advisory Council. While the focus of the Technology Statement is on new technologies, the Minister has indicated that mature technologies like coal and gas will continue to play an important role in Australia’s energy future. In the meantime we can expect more complementary announcements before the year is out, including the national electric vehicles strategy and ARENA’s bioenergy roadmap. Related Articles How foreign investment changes may impact the mining and energy sector In early June 2020, the government announced a review of the foreign investment rules, expanding them to apply to all foreign investors in anything deemed a ‘sensitive national security business’. The changes are scheduled to come into effect on 1 January 2021. There are concerns that this will impact foreign investment in the mining and energy sectors, and in particular the critical minerals space. The push for decarbonisation Climate change continues to be one of the critical issues facing industry and Government. The push for change is now accelerating with new and revised policies to reduce carbon emissions set to be introduced. Climate change action is being driven by business and industry While everyone’s focus in recent months has been on the COVID-19 pandemic, climate change was top of everyone’s mind when the year began with bushfires ravaging Australia. The pandemic has seen individuals and organisations assess their ideologies and perspectives on a range of topics, climate change being one of them. It now seems that climate change is back on everyone’s agenda and none more so than business and industry. How COVID-19 could change mining for the better The mining industry was deemed an essential service by the Government, which has enabled it to continue to operate during the COVID-19 pandemic. However, this hasn’t been without its challenges. New processes and procedures were required to address safety and social distancing and issues of supply and worker mobility have impacted how the industry operates. But with adversity comes opportunity and the mining industry has thrived and realised the potential for new improvements amidst the pandemic. Digital transformation in mining and energy As the global shift to remote work gathers pace, it is more important than ever that the mining and energy sector embraces technology. But a digital transformation offers more than flexible working arrangements. It has the potential to drastically cut down on industrial accidents, optimise operational processes and slash costs. What is concerning mining and metals industry executives today? Recent surveys conducted in the mining and metals industry sector indicate that climate change, price volatility and the risk of a global depression are the top concerns for executives. The KMPG Mining Risk Forecast 2020/21 Report nominates climate change and price risks as top-of-mind for executives while a mid-year survey by White & Case found that the fear of a global recession was the most common concern amongst those surveyed. It’s worth noting that the KMPG survey was conducted before the COVID-19 pandemic. However, the concerns raised have ongoing relevance both now and into the future. Showing 0 Comment Comments are closed.