Infrastructure emerged as a winner in the federal government’s big-spending 2020-21 budget and now the hard part: making sure these “nation-building” projects are sustainable.
Money is flowing into the built environment, with the government’s “JobMaker Plan” including an increase to the government’s infrastructure investment pipeline by $10 billion to $110 billion over 10 years.
The new and accelerated investment pipeline will include major infrastructure, transport and water projects, including the Inland Rail, the Western Sydney Airport and the $484 million Dungowan Dam project. A total of $2 billion is expected to go towards water infrastructure to “build the dams, weirs and pipelines to boost agricultural production in regional Australia”.
Farmers will also get a further $50 million to help upgrade their on-farm water infrastructure to recover from drought and floods and prepare for the next bout.
It’s not just about major infrastructure projects – an extra $2 billion has been put aside for “shovel ready” road safety upgrades and $1 billion for local councils to upgrade local roads, footpaths and street lighting on a “use it or lose it” basis.
The government has also flagged a range of energy infrastructure to be brought forward, including projects such as Marinus Link, VNI West and Project Energy Connect.
But whether or not some of these projects are actually being accelerated is in question, with Tasmanian Shadow Treasurer David O’Byrne wondering how a fast-tracked timeline of 2024 for the Marinus Link, which will be a second connection crossing the Bass Strait intended to make Tasmania the “battery of the nation”, is actually faster when state Energy Minister Guy Barnett recently said the project would be “shovel ready” in 2023.
Also on energy infrastructure, one surprise with little detail attached is funding for an ageing coal-fired power plant in the NSW Hunter Valley, the1320 megawatt Vales Point Power Station.
The $52.9 million “gas-led recovery” is also charging ahead, as are all the pre-budget commitments around the government’s “low emissions” technologies.
Around $1.9 billion over 12 years from 2020-21 will go towards the Australian Renewable Energy Agency and expanding the investment mandate of the Clean Energy Finance Corporation so that they can invest in promising technologies such as low-emissions steel and aluminium and the more dubious, fossil fuel-lifeline technologies such as carbon capture and storage.
Renewables will get a slice of the government’s big plans for boosting Australia’s local manufacturing capacity, as will electric vehicles. About $5 million in 2020-21 will go towards a factory in South Australia to build electric vehicles and fund a bi-directional vehicle-to-grid trial in the state.
Also encapsulated in the $1.9 billion worth of clean energy initiatives is $4.8 million over two years to develop a regulatory framework for offshore clean energy infrastructure industry, $67.1 million over six years to support pilot studies for microgrids in regional and remote areas, $95.4 million over six years from 2020-21 to create a co-investment fund that supports industrial, freight and agricultural and $74.5 million over four years to create a fund for finding clean fuel solutions for vehicles.
In research, $7.6 million has been allocated towards the Australian Community Climate and Earth System Simulator, which was built by the CSIRO to model the changing climate.
Energy efficiency for buildings gets a showing
Energy efficiency also hasn’t missed out on funding, with $52.2 million over five years set to improve productivity and lower energy costs in the building and hotels sectors.
This appears to include $12 million in grants to upgrade the energy efficiency of small hotels and pubs, $12 million in grants to upgrade the energy efficiency of community facilities, and $28 million for measures not specified.
In a letter to members, Energy Efficiency Council CEO Rob Murray-Leach wrote that he expects the $28 million to include funding measures such as the ongoing operation and expansion of the NABERS program and the Low Emission Trajectory for buildings.
ASBEC CEO Suzanne Toumbourou also hoped that some more of the detail around this package might have emerged in the papers.
While the government has been signalling its interest in energy efficiency in buildings through its latest announcements about low emissions technologies, it’s still not exactly clear how it plans to bring emissions down in the built environment.
She was hoping to see support for home energy ratings and the expansion of NABERS, and perhaps the inclusion of energy productivity in buildings as part of ARENA’s broadened remit.
“The top line is I’m hopeful… we’re still waiting to see the detail.”
GBCA chief executive officer Davina Rooney also pointed out that expansion of the instant asset write off scheme will help businesses invest in major energy efficiency upgrades and improvements to buildings.
“Not only could such investments create more than 91,000 job years of employment, they could deliver substantial secondary dividends including lower energy costs, improved resilience outcomes and reduced emissions,” Ms Rooney said.
“Business can use this extension to purchase more energy efficient equipment for commercial buildings such as large energy-intensive equipment like chillers, air handling units, pumps, and fans.”
Ms Rooney also welcomed the funding injection for infrastructure but warned the government not to waste an opportunity to ensure these projects are tied to standards for better environmental performance or encourage decarbonisation.
“With investments in transport infrastructure now topping $110 billion, it is extremely important that they are delivered in a sustainable way through independent certification.
“We urge the government to use the strong foundations for economic recovery it is pursuing to also deliver the cost-effective added benefits that come from a more energy efficient built environment.”
The Infrastructure Sustainability Council of Australia also welcomed the funding for infrastructure but also called for a focus on sustainability.
“As infrastructure plays a central role in Australia’s economic recovery, the scale of the federal government’s investment will challenge industry capacity to not only deliver – but to do so sustainably,” Ainsley Simpson, chief executive officer of ISCA said.
“We have solid evidence that measuring the sustainability performance of infrastructure upskills the workforce, encourages innovation and trains people to think more strategically across the asset lifecycle, which in turn enhances procurement and supply chain efficiencies.”
Ms Simpson also said the government had struck a balance between major infrastructure and smaller scale projects that give existing assets a second lease on life and support job in local communities.