Kate Chaney (Curtin, Independent) Share this | Link to this | Hansard source

This is a question for the Prime Minister. The US Inflation Reduction Act 2022 is a global game changer, attracting capital, technology and people to the US as it leads the way towards a net-zero world. The rest of the world is following suit. Despite our natural advantages, this makes it hard for Australia to compete as a green energy superpower without our own transition incentives. To ensure we don't miss the boat on massive future export opportunities like green hydrogen, will the government respond boldly to the Inflation Reduction Act?

Anthony Albanese (Grayndler, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the member for Curtin for her question and for her ongoing commitment to action on climate change. She is quite right to identify the Inflation Reduction Act as not only the most significant act ever passed by the United States to deal with the challenge of climate change; it will also have an impact around the world, and it's something that the Minister for Climate Change and Energy is very conscious of as well. Because there are such strong incentives to attract capital to the United States to build manufacturing, including in solar panels, batteries and other necessary infrastructure which is required, the act will, in a global economic environment, mean that it is harder, or that we're competing, to attract that capital here in Australia. That's one of the reasons why the government is responding as we are with the safeguard mechanism—to provide that certainty for business to invest going forward. But it's also part of the frame that we promised back in 2021 regarding the National Reconstruction Fund. How do we make sure that we don't just export our resources, wait for value to be added, wait for jobs to be created and then buy those goods back once value has been added? How do we seize the opportunity which is there for us to be a renewable energy superpower?

One of the discussions that I'll be having with Prime Minister Modi in India is precisely about that. Whether it is Prime Minister Modi or President Widodo of Indonesia, or any of our neighbours—which, in India and Indonesia's case, are growing to be the third- and fourth-largest economies in the world over the coming decades—that presents an enormous opportunity for us. We should be value-adding here wherever possible. We need to provide support for our industries here through the National Reconstruction Fund, which is modelled on the Clean Energy Finance Corporation. Essentially, we'll be funding projects that will produce a return on capital but mightn't be able to gain that capital in the market system. That's why, post the Inflation Reduction Act, it is more important that we have the National Reconstruction Fund. It is even more important that we provide the certainty through the safeguard mechanism going forward. I look forward to working with the member for Curtin. WA in particular has lithium, has nickel, has these resources that are so important, which is one of the reasons why I took the entire cabinet to Port Hedland to have discussions with the business community about how we can take advantage of our position going forward.