Federal Budget: Hydrogen industry receives billions as EVs snubbed

Australia’s hydrogen industry is about to get a boost, with the Federal Government committing $1.5 billion in the latest budget.

The omission of additional funding for electric vehicles (EVs) in the Federal Budget 2022-23 was conspicuous by comparison, despite billions being earmarked for a carbon offset scheme and $565 million for “international low emissions technology partnerships”.

While funding for the Australian Renewable Energy Agency (ARENA) was increased to a total of $250 million in February, the total budget is less than 12 per cent of the money provided to the hydrogen industry this week.

Australia’s burgeoning hydrogen industry already supplies the fuel to Japan, while a hydrogen superhighway was announced between Victoria, New South Wales, and Queensland, with the aim to reduce emissions produced by long-haul heavy commercial vehicles.

This week’s budget announcement did include the announcement of $1 billion for a new Grid Reliability Fund, which will be created under the purview of the Clean Energy Finance Corporation (CEFC) to support investment in new energy generation, storage, and transmission infrastructure.

The Federal Government says it has “outlined a practical, responsible way to deliver net zero emissions by 2050 while preserving Australian jobs and generating new opportunities for industries and regional Australia”.

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However, car companies, as well as electric vehicle advocacy associations, have long criticised the Federal and state governments in Australia for not doing enough to encourage the uptake of EVs in the country – the result being carmakers are prioritising their battery-powered models for other markets.

Despite this, sales of electric cars have soared in recent months, building on the back of a record 20,615 sold in 2021.

“We will not be forcing Australians out of the car they want to drive or penalising those who can least afford it through bans or taxes,” Prime Minister Scott Morrison said in November 2021.

“Instead, the strategy will work to drive down the cost of low- and zero-emission vehicles and enhance consumer choice.”