Weld Australia is urging the federal government to enact a national policy framework that guarantees a sufficiently strong pipeline of work for manufacturers to build a sovereign renewable energy manufacturing capability.
Weld Australia recommends mandating 60 per cent local content of Australian fabricated steel by kilogram compliant to Australian Standards.
The call to act follows news the Fortescue Metal Group will invest $750 million to build the Phoenix Hydrogen Hub in the US.
The company will build an 80-megawatt electrolyser and liquefaction plant with a production capacity of 11,000 tonnes per annum of liquid green hydrogen.
Weld Australia CEO, Geoff Crittenden, said the US government secured the investment by providing incentives under the $550 billion Inflation Reduction Act (IRA).
“Our government must enact equivalent policies and legislation that encourage private investment and secure a pipeline for local business. The alternative is that Australia remains a dig and ship economy,” he said.
“We must grow our manufacturing capability at a rapid pace if for Australia to have the resources to meet net zero targets.
“At this stage it would be safe to assume that Australia, despite its natural advantages and ambition to become an energy superpower, will be a small player in the global market without the scale to secure supply or value.”
According to not-for-profit think tank Climateworks, $625 billion worth of investment is needed to decarbonise Australian industry and the energy system by 2050.
This includes $400 billion of business-as-usual investment by the private sector, and a further $225 billion to transition the energy system.
Fortescue is expanding the production of hydrogen from renewable resources with its Fortescue Energy unit, with plans to also fast-track projects in Brazil, Kenya and Norway.
Locally, the world’s fourth largest iron ore maker is moving ahead with its 50-megawatt green hydrogen project in Queensland, and the Christmas Creek green iron trial in Western Australia.