Charging The Battery Industry
The Australian government’s new National Battery Strategy aims to grow manufacturing capacity, strengthen supply chains, and decrease reliance on offshore products for energy essentials. It dovetails with the government’s previously announced Critical Minerals Strategy to expand downstream processing and help meet future local global demand. Announcing the battery strategy on 23rd May, Minister for Industry and Science Ed Husic told the media that while Australia supplied nearly half the world’s lithium (45%) last year, it made less than 1% of battery materials or components. He pointed out that while 3.7 million homes here have rooftop solar, only 250,000 have a battery to store it. Meanwhile, world demand for batteries is expected to quadruple by 2030 as demand increases for battery electric vehicles and the world moves to net zero.
Asked by ABC Radio National whether Australia can compete with China, the biggest battery producer, Minister Husic said a lot of countries are recognising that their dependency on that concentrated supply chain is not in their national interest. “If there are disruptions to that supply — either accidental or otherwise — we are vulnerable. If you look at what we have announced in the Budget more broadly, for instance the critical minerals strategy is about increasing processing and developing pipe fabrication. We have looked at the whole value chain within this strategy and elsewhere and we are very good at mining and refining but a lot of the processing is done in China.” Husic said that once Australia adds more value by doing more onshore processing, Australia will be able to compete. “We can do more of this onshore … once that occurs … then we’re in a better space to do cell manufacture.”
Broadcaster Patricia Karvelas pointed out that both Treasury and the Productivity Commission have said Australia does not have the capacity to build sustainable battery manufacturing — views which Minister Husic dismissed as “economic orthodoxy”. “A lot of that is orthodox thinking, is about just relying on our comparative advantage and …. just maintaining the old dig-and-ship mentality. If you look at what the rest of the world is thinking about and the recognition of what we need to do to get to net zero and how to do it and setting up mechanisms — particularly in terms of in our space — which is a lot more of a demand of people to step forward with bids as to how they would be able to scale up production and making decisions on that basis. What we are trying to do is get the balance right between what we do with taxpayer funds, being able to increase our ability to do more onshore, and reduce dependency on [offshore] supply chains – which is an Australian manufacturing trend . And recognising that the world has turned on these issues because we have got the challenge of emissions reduction and getting to net zero.”
In his foreword to the battery strategy document, Husic hailed steel fabrication Australia’s “unmatched natural advantages” to create a battery industry: world-leading renewable energy resources, critical minerals, skilled workers, robust mining plant and equipment, and a strong international trading reputation. Husic asserts the strategy is the latest milestone in Australia’s impressive history in battery advancement. “Australia has been at the forefront of the battery industry for decades, from pioneering the vanadium redox battery at the University of New South Wales to installing the world’s first big lithium battery in South Australia. Across Australia, businesses continue to innovate in the battery industry.”
