Greg Combet hints at Federal Budget boost for green energy as new ‘net zero’ authority takes shape

New initiatives to turbocharge “large-scale” investment in green energy production are set to be a pillar of the upcoming Federal Budget.

Former Labor climate change minister Greg Combet, who is now leading the Federal Government’s net zero transition authority, flagged the package in a speech on Tuesday.

The Government has been urged to use its May budget to launch a comprehensive response to the US’s game-changing inflation Reduction Act (IRA).

In a major step, Prime Minister Anthony Albanese last week announced $1 billion in subsidies and grants to support local manufacturing of solar panels and parts.

Addressing the National Press Club in Canberra, Mr Combet hinted at more to come.

“The Government will lay out the next phase of its approach in the May Budget, which will look to capitalise on Australia’s comparative advantage in minerals and renewable energy, aiming to encourage large-scale investment in green industrial production,” Mr Combet said.

WA’s critical minerals players have been campaigning for tax production credits to be included in the budget as they struggle to compete with overseas markets or, in the case of nickel miners, teeter on the brink of collapse.

Treasurer Jim Chalmers last month said options to support the sector were being considered – but he stopped short of committing to any rescue package in the budget.

Mr Combet was last year appointed the inaugural chair of the Net Zero Economy Agency, a body tasked with overseeing the energy transition.

The Rudd and Gillard-era minister will leave the agency on May 31 to begin a new role as chair of the $270 billion Future Fund.

Legislation to turn the net zero agency into a full-blown Commonwealth authority was last week introduced to Federal Parliament in what Mr Albanese heralded as a major step forward in green energy shift.

The authority will oversee a new “re-deployment” scheme to help workers at retiring coal-mines and gas-fired generators find new jobs.

While the Federal Government wants companies to voluntarily participate in the so-called Energy Industry Jobs Plan, the Fair Work Commission would be given the power to compel them to buy in.

Mr Combet doesn’t want to see a repeat of the “very disruptive” Hazelwood coal mine closure in Victoria which left a “lot of scars”.

But he said the scheme was not meant to be adversarial, insisting the Fair Work Commission process was only there as a back-up if talks between the company and its workers failed.

Speaking more generally about policies to spur clean energy spending, Mr Combet said the IRA had “changed the game” while the EU, Japan and Korea were following suit with “unprecedented investments” in their industrial bases.

“While we can’t go toe-to-toe on investment with countries like the US, one thing is clear,” Mr Combet said.

“Australia has a compelling comparative advantage in our abundance of renewable energy and mineral resources – plus our skilled workers and reliability as an investment destination and trading partner.

“These advantages can be harnessed to develop industries that will diversify our economy and locate Australia in low-carbon global markets.”