Submission: Coordinating investment for Australia’s climate goals

The front door will have the most impact if it works to deliver investments that are in alignment with the government’s Net Zero Australia Plan for a coordinated sectoral-based approach, and if it can unblock issues within planning processes that lead to unnecessary delays.

Key points of the submission:

• There must be an overarching approach for each sector wherein the front door takes the barriers and opportunities identified in sector plans and assessments, and then presents opportunities for major transformational projects to the market. Improved visibility for market stakeholders will facilitate more rapid identification of opportunities. This, combined with better access to government facilitation services and financing, will mean more projects come online sooner.

• A proactive market outreach approach to the front door, under the National Interest Framework (Future Made in Australia Bill 2024) and the governments’ yet to be announced Net Zero by 2050 Plan, will be critical to its success. Investors do not need just another website. Proactive outreach on investment opportunities by the front door will support two-way engagement between governments and investors, and lead to better overall investment outcomes.

• There is not a lack of investor appetite, but a lack of coordination. Domestic investors find planning processes to be convoluted, with shifting expectations, timeframes and frequent turnover within staffing teams. Dedicated caseworkers for major and transformational projects are essential. IGCC therefore supports streamlining services to ameliorate unnecessary delays. Despite the expansion of public financing vehicles, bottlenecks within processes have worsened. “Crowding in” investment internationally without addressing these issues will create compounding bottlenecks within the investment ecosystem. Environmental and social standards for significant projects should not be undermined by fast tracked services, with good outcomes for communities and the environment carried throughout – not a “tick and flick” at the planning stages.

• Social infrastructure, well paid jobs and skilled workforces must also be a consideration within the front door’s mandate, guided by Community Benefits Principles under the National Interest Framework.

• Learning by doing is the fastest way to drive clean energy industrial development across Australia. This will inevitably mean that some investment opportunities fail. This is a critical part of building a clean economy and thriving investment ecosystem. The front door should have an active role in communicating to the market the learnings from successes and failures. The front door should annually publish a ‘leanings’ report to support further learning by doing, and better identify least-cost outcomes across the economy.

• Improved capital allocation across the stack between Specialist Investment Vehicles will fast track decarbonisation technologies entering the market. Tailored SIV’s – the Capacity Investment Scheme, the Australian Renewable Energy Agency (ARENA) and the Clean Energy Finance Corporation (CEFC) – all successfully deliver their mandates. However, there is a lack of coordination between SIV’s, not just at the project level, but towards achieving transition goals in the national interest.

• Climate adaptation activities should be explicitly included in the front doors mandate, not just mitigation activities, with priority projects chosen in alignment with the National Adaptation Plan.

Read the full submission.