Fast read
The "Future Made in Australia" policy is a bold national strategy to transform Australia into a renewable energy superpower. Championed by the Labor Government following its 2025 re-election, the policy focuses on building domestic industries—particularly in clean energy and advanced manufacturing, while reducing reliance on volatile global supply chains.
Central to this plan are generous production incentives for renewable hydrogen, battery supply chains, and critical minerals processing. The overarching goal? Secure Australia’s long-term prosperity by turning its natural advantages into local jobs, clean industries, and a resilient, low-emissions economy.
Future Made in Australia Policy Explained: What It Means for You
As global markets shift towards decarbonisation and supply chain resilience, Australia faces a crucial question: How can we remain competitive while cutting emissions and creating jobs at home?
The “Future Made in Australia” policy is the Labor Government’s answer. Rather than continuing to export raw materials and import finished goods, the plan shifts focus to value-adding industries— like solar panel and battery manufacturing, green hydrogen, and critical minerals processing—all powered by clean Australian energy.
What are the main goals of the Future Made in Australia policy?
At its core, this policy is about securing Australia’s future in a low-emissions global economy. Here’s what it aims to achieve:
Turn Australia into a renewable energy superpower
With abundant solar and wind resources, Australia is well-placed to lead in clean energy production. The policy fast-tracks renewable hydrogen, green metals, and zero-emission fuels—industries where we can develop a lasting edge.
Process and manufacture onshore
Instead of just mining lithium or rare earths, the goal is to process them into battery materials or components domestically. This creates high-value jobs, builds national capability, and reduces export dependency.
Strengthen economic security
By building strategic industries locally, Australia can insulate itself from global shocks—whether geopolitical tensions, supply chain bottlenecks, or commodity price swings.
Accelerate net-zero transformation
From industrial decarbonisation to electrified transport, the policy backs sectors that are essential to Australia’s emissions targets, with an eye on long-term economic returns.
Encourage investment and innovation
By using production tax incentives and co-investment tools, the policy aims to crowd in private capital while supporting Australian-led R&D and commercialisation.
How will the government decide what to fund?
National Interest Framework
The policy’s investment strategy is shaped by a National Interest Framework—divided into two focus areas:
- Net Zero Transformation Stream: Targets sectors like green hydrogen and critical minerals that can slash emissions and position Australia as a clean energy exporter.
- Economic Security and Resilience Stream: Backs industries vital to national interest but vulnerable to market failure or foreign control.
The Treasury will oversee how public funds are allocated, guided by legislation under the upcoming Future Made in Australia Act.
Community Benefit Principles
All major investments must also deliver tangible local benefits—such as regional job creation, workforce diversity, and stronger local supply chains.
What are the priority sectors and programs?
The policy is backed by $22.7 billion in federal funding over the decade, targeting high-potential industries and technologies. Key initiatives include:
Clean hydrogen
A new Hydrogen Production Tax Incentive offers $2 per kilogram for clean hydrogen produced locally between 2027 and 2040—one of the world’s most generous schemes.
Critical minerals processing
A 10% refundable tax offset will apply to processing costs of 31 listed critical minerals, such as lithium, cobalt, and rare earths. This aims to move Australia up the value chain and reduce global dependencies.
Green metals
Funding supports low-carbon production of green iron, steel, and aluminium—key inputs for infrastructure, EVs, and renewables. Grants help heavy industries transition to 100% renewable energy.
Solar panels and battery manufacturing
Through the Battery Breakthrough Initiative and Innovation Fund (administered by ARENA), the government is supporting local manufacturing of clean energy components like lithium-ion batteries and PV modules.
Low-carbon fuels
Investment in sustainable aviation fuels (SAF) and renewable diesel aims to decarbonise sectors where electrification is harder, such as aviation and freight.
Skills and workforce
Funding is being directed to TAFEs, trainers, and apprenticeship programs to rapidly build a skilled workforce for the clean energy transition—especially in regional areas.
What legislation underpins this?
The policy is being formalised through the Future Made in Australia Act, which will establish:
- The legal framework for the National Interest Framework
- Authority to administer production tax incentives
- Oversight for project eligibility and public benefit assessments
Additional laws will support the Guarantee of Origin (GO) scheme, enabling buyers to verify the emissions profile of hydrogen, batteries, and other clean energy products.
What does this mean for renewable energy in Australia?
The policy isn’t just about heavy industry—it’s about transforming the entire energy system. Key benefits include:
- Faster renewable rollout: More support for large-scale solar, wind, and storage projects.
- Domestic supply chains: By making more clean energy gear in Australia, we reduce reliance on overseas suppliers.
- Innovation leadership: Funding helps local inventors and startups scale new technologies.
- Clean energy jobs: Thousands of jobs are expected across solar farms, battery factories, and hydrogen hubs.
- Global competitiveness: Clean exports—like green hydrogen and processed minerals—can replace declining fossil fuel exports over time.
What’s in it for homeowners and small businesses?
While the policy is industry-focused, many benefits will filter down to households and small businesses:
- More affordable clean energy in the long run, thanks to scale, efficiency, and local supply.
- Greater energy security, with less exposure to global fuel price shocks.
- New opportunities to participate in local clean energy supply chains or workforce transition programs.
- Regional investment, with training hubs and job creation focused on industrial and rural areas.
If you’re considering solar, batteries, or EV chargers for your home or business, the evolving local supply chain could offer more Australian-made options in the near future.
Final thoughts: Charting a path to a cleaner economy
The “Future Made in Australia” policy represents a generational shift in how Australia approaches economic development. Rather than being price takers in global markets, it envisions Australians as value creators—building clean, competitive industries here at home.
Whether you’re a homeowner, business owner, or energy professional, understanding this policy gives you insight into where the country is heading—and how you might benefit from a cleaner, more self-reliant energy future.
Need help navigating your own energy decisions? Your Energy Answers connects you with accredited professionals to explore solar, batteries, and energy-efficient upgrades tailored to your needs.
