And the interest is coming from all sides.

At Labor’s recent national conference, the Electrical Trade Union (ETU) led a successful motion demanding the Commonwealth government invest big money to support domestic clean technology industries.

The Business Council of Australia (BCA) released last week a report that called for a reinvigorated government industry policy to develop advanced manufacturing and renewable sectors, among others.

Several landmark reports, including by the Centre for Future Work, have all reached the same conclusion: Government must invest big in industry policy to accelerate the clean energy transition and build Australian renewable industries.

No doubt about climate crisis

Business, unions, and civil society are all singing from the same sheet. Clearly, something has changed – but why?

The past year has seen tectonic shifts in the global policy landscape.

The climate crisis is now impossible to ignore.

The past eight years have been the eight hottest on record – and July may have been the hottest month in 120,000 years. The northern hemisphere has been buffeted by floods, fires and natural disasters, and Australia is anxiously anticipating the coming El Niño summer.

The costs of climate inaction are clear. However, awareness is also growing of the profound opportunities of climate action.

In the United States, President Joe Biden has embraced climate action as an economic and jobs opportunity. Decarbonisation has been put at the heart of his administration’s “modern American industrial strategy”.

The Inflation Reduction Act (IRA) and the Infrastructure and Jobs Act direct between $US750 billion and $US1.2 trillion to expand clean tech manufacturing, renewable energy generation, and sustainable infrastructure.

In just its first year, this legislation has driven massive private sector investment, and already created more than 170,000 new green jobs.

In China, long-term government investment and industry planning in renewable tech has given that country global dominance in the clean energy supply chain.

Last year, the Chinese government invested $US546 billion into clean energy – more than the rest of the world combined. This included the installation of 107GW of solar output, roughly equivalent to the entire historical installed capacity of the US.

The International Energy Agency (IEA) estimates China holds 60 per cent of global manufacturing capacity for most clean technologies.

The rush is on to keep up

Suddenly, the world is rushing to keep up with the US and China’s investment.

The European Union now plans to invest more than $US1 trillion into renewables over the next decade and the EU is expected to reach 2030 clean energy targets years ahead of schedule.

The governments of Japan, Canada, South Korea, India, and even Saudi Arabia are also all investing substantially in clean tech manufacturing.

Back in Australia, senior government ministers declare their ambitions to make Australia a “renewable energy superpower”. But it takes more than just aspiration to achieve that.

Across the world, big money is being spent empowering renewable industries. The global clean technology race has begun, and Australia is barely on the track.

The Australian government must act now.

Promisingly, the Commonwealth government set aside funding in the 2023 budget to investigate the changing global, clean energy, industrial landscape and prepare Australian policy responses before the end of this year.

This suggests the government already realises its present policies – including the National Reconstruction Fund, the Powering the Regions Fund, and the Clean Energy Finance Corporation – are inadequate to this competitive challenge.

The bottom line is that we need to spend more – much more.

Centre for Future Work research presented to the recent National Manufacturing Summit estimates Australia must spend between $83 billion to $138 billion over the next decade to proportionately match the US IRA in fiscal supports.

The ETU and the Australian Manufacturing Workers Union (AMWU) have gone further, suggesting a total investment of $152 billion.

More than just spending

But spending alone is not the answer.

To ensure a new Australian industry policy actually works to drive decarbonisation, rebuild manufacturing, secure supply chains, and create secure, well-paid jobs, that money must be spent effectively.

This means any government support for private industry comes with conditions attached, particularly concerning fair pay, secure working arrangements, and rights to collective bargaining.

This means planning and co-ordination across various levels of government, the private sector, trade unions, and other stakeholders to ensure policy has maximum impact and money is spent where it is needed most.

This means developing an expanded, skilled, and inclusive workforce through investment in apprenticeships and TAFEs.

This means ongoing performance monitoring, backed by enforceable
requirements (like claw-back provisions) to ensure businesses receiving public finance are accountable to public expectations.

And beyond just grants and subsidies, government should not be afraid to make direct, public equity investment in private, clean-technology companies.

This ensures the Australian public will share in the profits of successful subsidised ventures, not just bear the cost of unsuccessful ones.

The growing consensus around the need for a new Australian industry policy provides an opportunity to reshape the Australian economy, rebuild manufacturing, and create thousands of secure jobs – all while acting on the climate crisis.

It’s time for the Commonwealth government to make it happen.