4 April What the Federal budget and election mean for the sector April 4, 2022 By AMPLA Admin General 0 The Federal election has now been set for May 21st and follows the recent 2022/23 Federal Budget announcement and Opposition’s reply. The Liberal party’s budget positions the energy and resources sector for growth with $2.4 billion allocated to the industry, energy and emissions reduction portfolio. The budget included an investment of $1.3 billion to maintain energy security and reduce the pressure on prices while encouraging emissions reduction. The Federal election has now been set for May 21st and follows the recent 2022/23 Federal Budget announcement and Opposition’s reply. The Liberal party’s budget positions the energy and resources sector for growth with $2.4 billion allocated to the industry, energy and emissions reduction portfolio. The budget included an investment of $1.3 billion to maintain energy security and reduce the pressure on prices while encouraging emissions reduction. This includes: $300 million to support low emission LNG and clean hydrogen production in Darwin. This is coupled with carbon capture and storage infrastructure, positioning Darwin to become a world leading clean energy hub. Given its proximity to natural gas and greenhouse gas storage resources, the region is well positioned for growth; $247 million was earmarked to support private sector investment in low emissions technologies including the hydrogen Guarantee of Origin scheme; $200 million has been allocated to support new low emissions manufacturing facilities in the Pilbara region and a further $100 million to de-risk private sector investment in firm generation and grid infrastructure in the region; $200 million will be used to increase onshore processing value-add to iron ore exports. This is expected to support low emissions steel production in countries like Japan and South Korea; $148 million to support investment in reliable power including the deployment of microgrids in regional communities; $100 million to make the Port of Newcastle hydrogen-ready; and $50 million has been earmarked to accelerate the development of priority gas infrastructure projects in line with the Future Gas Infrastructure Investment Framework. Additional measures include supporting the Clean Energy Supply Chain Forum and the Hydrogen Energy Supply Chain pilot. Keeping wholesale electricity prices below $70/MWh is another focus with delivery of the Marinus Link undersea interconnect to connect Tasmania’s Battery of the Nation project with the mainland. In addition, investments will also be made in the Hunter Power Project to provide reliable electricity. In total the Government has also committed to invest more than $22 billion in low emissions technologies this decade to continue on the path to achieve net zero emissions by 2050. The Government also reacted to the increased cost of living fuelled by the war in Ukraine by announcing a temporary reduction in the fuel excise by 50% for six months. Businesses will still receive fuel tax credits for eligible fuel use. The Opposition’s budget reply speech also focused on infrastructure and growth. Key initiatives impacting the sector include: Subsidising 465,000 TAFE places to skill, up skill and resell the workforce to support net zero goals; Allocating an additional 20,000 university places to ensure Australia has the skills it needs to grow; Upgrading the electricity grid to fix energy transmission and reduce prices; For facilities covered by the Government’s Safeguard Mechanism, reducing emissions gradually and predictably over time to achieve net zero by 2050; Up to $3 billion to invest in initiatives like green metals, clean energy component manufacturing, hydrogen electrolysers and fuel switching; Establishing a Powering the Regions Fund to provide financial support to initiatives that improve energy efficiency in new and existing industries in regional Australia; Investing up to $15 billion in projects to create jobs through initiatives like equity and guarantees in resources, enabling capabilities and renewables and low emissions technologies; Focus on revitalising manufacturing including adding value to our resources by strengthening our ability to create finished goods like batteries; and Investing in infrastructure including roads, rail and ports to improve efficiency. With both parties focused on economic growth, cost of living and climate change, the next few weeks are likely to bring more promises to boost the industry. 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. 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. The impact of the Russia/Ukraine conflict on the sector On February 24, Russia invaded Ukraine. Alongside the destruction and terror that’s been inflicted on the Ukrainian people, the conflict has also created great uncertainty in the global economy with flow on effects expected to be felt for years to come. Most western countries have imposed significant sanctions on trade with Russia, which includes a US ban on importing Russian oil. In addition, many Russian banks have been removed from the SWIFT global payment system which will impact the ability to make financial payments both within and out of Russia. This has a significant impact on the resources sector that is likely to continue in the short to medium term. What to expect in 2022 Despite an unpredictable two years, the energy and resources sector has weathered tumultuous conditions and come through stronger. All signs indicate that 2022 and beyond will see strong growth in demand and exciting new developments. What law firms and in-house legal are doing to combat the threat of coronavirus The novel coronavirus (COVID-19) is drastically changing how we live, work and even play. For law firms and in-house legal practitioners, that means balancing the concerns of your clients with safeguarding your own staff. In some ways, small firms have an advantage over their larger counterparts. Moving to remote or online work is simpler with fewer moving parts to accommodate. On the other hand, it can be challenging to meet the increased needs of your clients at this anxious time. For in-house legal services, the size of the challenge becomes one of risk management for their organisation. But even those with strong governance and business continuity plans in place are struggling to manage many of the unprecedented issues they’re facing today. The states boost the energy and resources sector This year will be remembered for the many challenges that it brought to both individuals and industry. As Australia starts to return to some normality, many states are looking to boost industry, increase jobs and innovate for the future. In this article, we look at various state initiatives designed to boost the energy and resources sector. Showing 0 Comment Comments are closed.