Strengthened Safeguard Mechanism welcome, falls short of export opportunity

Beyond Zero Emissions, a leading Australian think tank, has offered support to the Safeguard Mechanism reforms legislated today while acknowledging Australia has a long way to go to realise its renewables powered “exports powerhouse” potential.

CEO of Beyond Zero Emissions, Heidi Lee, says: “This is an important day for Australia’s transition to the clean economy. Congratulations to the Albanese Government and Minister Bowen, the Greens and crossbench MPs for working constructively to pass amendments that strengthen these laws and reflect the importance of supporting our industrial sector to decarbonise.”

“Australia’s industries contribute 47% of our overall emissions. Australians can be confident that, following passage of these reforms, our industrial manufacturers will be incentivised to move to 100% renewable energy and emissions created by our industries will start to come down.”

Beyond Zero Emissions has been working alongside communities in our energy-intensive industrial regions for the last four years. Our research shows that the fastest and most effective way to reduce emissions, keep manufacturers and heavy industry onshore and incentivise new industries to grow, is to create zero-emissions manufacturing clusters.

Our national model for Renewable Energy Industrial Precincts takes a place-based approach to industrial modernisation. The model targets investment to clusters of existing manufacturing hubs to maximise the efficient use of scarce skills and resources, delivering the dual benefits of economic security and emission reductions.

Lee says, “The Safeguard Mechanism reforms are a step in the right direction, however taking a facility-by-facility approach to industrial decarbonisation does little to set up our manufacturing sector to compete in a global economy where our trading partners are incentivising domestic manufacturing to the tune of hundreds of billions of dollars.”

“We call on the government to invest in a national program to coordinate planning and investment in regional industrial clusters so that our industries are supported to meet emission reductions requirements legislated under the Safeguard Mechanism.”

Beyond Zero Emissions’ Export Powerhouse report details how new green export industries, such as green steel, critical minerals and renewable hydrogen, can be scaled up to meet surging demand for zero-carbon products and dominate global economic growth this century. Independent economic modeling by Acil Allen demonstrated that industrial precincts powered by renewable energy can grow our green export mix to $333 billion per annum, far exceeding the value of existing fossil fuel exports.

Lee says, “Even with the Safeguard Mechanism legislated, we are still falling short of realising a once-in-a-lifetime opportunity to develop zero-emissions manufacturing hubs in key regional locations like Gladstone and the Hunter. This clustered approach to industrial decarbonisation gives Australia its best shot at revitalising domestic manufacturing and becoming a green exports powerhouse.”