18 April 2024

Future Made in Australia Act - a shot in the arm for cleantech?

Spruson & Ferguson


Established in 1887, Spruson & Ferguson is a leading intellectual property (IP) service provider in the Asia-Pacific region, with offices in Australia, China, Indonesia, Malaysia, Philippines, Singapore, and Thailand. They offer high-quality services to clients and are part of the IPH Limited group, which includes various professional service firms operating under different brands in multiple jurisdictions. Spruson & Ferguson is an incorporated entity owned by IPH Limited, with a strong presence in the industry.
The Future Made in Australia Act, announced recently, may be the incentive for expanded investment in cleantech.
Australia Intellectual Property
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The recently announced Future Made in Australia Act may turn out to be the shot in the arm the Australian cleantech sector has been waiting for...

Cleantech, IP and Australia

We've written and spoken a fair bit recently regarding "cleantech" and IP's role in this vogue sector. A lot of it comes back to an inherent tension between incentivising innovation in cleantech and the public good in allowing climate-mitigating technologies to be monopolised. There's also an apparent lack of incentive to innovate in cleantech as opposed to pharmaceuticals, medtech or other technologies competing for increasingly scarce R&D dollars. With climate change increasingly real and the clock ticking, this lack of incentivisation is increasingly becoming the elephant in the room. And it's certainly not a case of one size fits all, as Australia's cleantech industry experiences these tensions in a blend unique to our little corner of the world.

The "Future Made in Australia Act"

Step forward the Australian Government. Hot on the heels of President Biden's Inflation Reduction Act ("IRA"), which among other initiatives earmarks unprecedented investment in cleantech, and the European Commission's more self-explanatory Green Deal Industrial Plan comes the Future Made in Australia Act, which was announced by Prime Minister Anthony Albanese recently.

Whereas the scale of the American IRA is literally of the order of hundreds of billions of dollars in tax breaks and subsidies over the next decade, Mr Albanese's initiative is more proportionate to our global scale and footprint:

"Obviously, Australia cannot go dollar for dollar with the United States' Inflation Reduction Act.. ..But this is not an auction – it's a competition and Australia can absolutely compete for international investment when it comes to our capacity to produce outcomes, the quality of our policies and the power of our incentives."

Of course, the devil is in the detail – and the magnitude of the investment is slated to be around $15 billion across not only cleantech, but also loans, equity and guarantees in resources, agriculture, transport, medical science, defence capability and enabling capabilities.

Cleantech innovators will have to earn their piece of the pie on merit, which shouldn't phase anyone given the world-class R&D the Australian cleantech sector is renowned for.


Those passionate about cleantech will applaud this initiative and probably not worry too much about the Government's true motivation for introducing it. On the one hand, it's unquestionably a "feelgood" initiative and one would hope the right thing to do. On the other hand, following IRA, there had been fears that the US' additional gravity may have led to it siphoning off much of the available international capital in renewable energy and related critical industries. The cynic may suggest that this effectively forced our government's hand here.

Of course, the Government will also be aware of its own climate plans in which Australia aims to reach Net Zero greenhouse gas emissions by 2050. We're not going to get there passively.

In fairness, the Albanese Government has consistently expressed a desire to see Australia step up in areas such as battery and solar panel manufacturing, harnessing the materials mined in Australia but currently exported overseas for processing, etc. A good example is lithium, in which we supply about 50% of the global market yet bank only about 1% of the proceeds.

As a "cleantechie", I'm likely biased, but it's fantastic to see the Government putting its money where its mouth has been. Australia has a vibrant cleantech community which punches well above its weight on the international stage and in my role, I'm lucky to see many of these technologies come across my desk each day. To reward our existing cleantech community and to incentivise its growth is due recognition of what's been bubbling (down)under for a long time now.

The next step toward the Future Made in Australia Act is for plans to be costed in the Federal Budget, which is conveniently less than a month away (14 May 2024).

This may finally be the shot in the arm the Australian cleantech sector has been waiting for.

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