Australia, like other economies around the world is embarking on the greatest transformation since the industrial revolution – a transition to a net zero future. Our economic future, like others’ will depend on rapid deployment of renewable energy, renewable hydrogen to decarbonise hard-to-abate sectors, and to enable clean manufacturing and supply chains. Put simply, our future prosperity is inextricably linked with development of an Australian energy-industrial complex.
Australia’s natural advantages means we are well-placed to develop a clean energy export market. But we are at risk of being left behind in the race to become a clean energy superpower as economies around the world enter into a bidding war for market share and dominance of clean energy supply chains. New analysis of US Inflation Reduction Act (IRA)’s clean energy incentives unpack implications for Australia’s hydrogen aspirations.
Head of Deloitte Access Economics, Dr Pradeep Philip, said:
"We have a wealth of comparative advantages in green industries like hydrogen but we’re at risk of falling behind in the race to net zero. Despite Australia’s clean energy ambitions, the reality is our global competitiveness is declining. The US Inflation Reduction Act looks set to cut Australia’s renewable hydrogen lunch. Australia will need to take decisive and swift policy action to secure Australia’s global competitiveness – this means an urgent and significant new energy-industrial policy. These new policy settings should aim to maximise public value by building out place-based industrial ecosystems and offering support across value chains to grow value-added economic activity within Australia. We’re standing at a crossroads and our future prosperity depends on getting the transition right."