Net zero talent a wake up call

The Albanese Government’s decision to delay its green energy industry policy until the 2024 Federal Budget is an important wake-up call for all players in Australia’s net zero transition.

The Government believes we don’t yet have the skilled workers, technology and regulation in place to fully embrace the opportunities of this transition.

And Treasurer Jim Chalmers has warned “we need to get more projects off the ground, faster” or the energy transition will “fall short of what the country needs”.

For the transition to succeed, WA will have to play a key role.

The four industries the Federal Government has identified as key to success are: critical minerals; battery manufacturing; renewable hydrogen and ammonia; and green metals such as iron ore, steel and alumina.

WA has many natural advantages in these industries through its abundant mineral deposits – in particular of battery and critical minerals – as well as its climate and its natural environment.

We are already the largest supplier of lithium globally. We are the world’s second largest producer of rare earths, with nearly a quarter of global reserves. There are also opportunities to build more solar and wind farms.

Seizing these opportunities is important not only to meet Australia’s commitment to net zero emissions by 2050, but also for the economic diversification of the State, which until now has chiefly relied on exports of our big two resources: iron ore and liquefied natural gas.

These resources have been critical to our State and national prosperity, powering our economic growth over decades.

But as demand cools over the longer term as the energy transition unfolds, we must develop new industries and markets, while decarbonising existing industries, to secure our future prosperity.

WA’s traditional strengths of mining expertise, delivering largescale infrastructure projects and a reliable operating environment for business and government are also crucial advantages.

We should also bring other parts of the battery and other clean technology supply chains to the State, such as lithium refining and other mineral processing, where it makes sense to do so. This will bring more high-skilled and advanced manufacturing jobs to Australia and ensure we make the most of our exports. 

WA has a long history of boom-and-bust cycles in the resources sector. But many of these cycles have been hampered by a lack of strategic policy direction and limited co-ordination between providers and the State on project timing and infrastructure construction.

This drove costs higher and caused project delays due to a lack of workers and materials needed to build new infrastructure. We should not repeat these mistakes this time around.

Given the scale of work required, we will need a clearer strategic direction from the State and Federal governments on priority industries, without resorting to picking winners.

We also need better co-ordination between all levels of government, industry and community groups, as well as across investments, infrastructure and approval regimes, to ensure we can act quickly and seize these opportunities. We must work with the Federal Government to get this right. And we must speed up approvals processes.

We need to bring the best talent, ideas and investment to the State. That includes attracting migrants who are highly skilled in clean technology roles.

But competition will be intense, as we are already seeing with the US’s Inflation Reduction Act, which will pour some $500 billion into programs to accelerate the net zero transition.

At the same time, we must bring the community with us on the journey, or we will lose public support for our net zero ambitions.

As with any major structural change, this transition will hit some workers and communities hard, while others will benefit.

Communities and workers in traditional fossil fuels industries will need targeted, tailored support to help them update their skills, retrain or move to different industries.

We also need to better communicate that this is a jobs transition as much as an energy transition. There will be many clean energy job opportunities, and we will need to develop local skills in key industries.

The prize is big if we succeed — a clean and more diversified State economy that will provide jobs and opportunity for more West Australians for decades to come.

This article was originally published in the West Australian on 16 November 2023.