Australia and the United States have agreed to work together to speed up and expand clean energy supply chains, renewable energy technological manufacturing and critical mineral supplies.
Australian Prime Minister Anthony Albanese and US President Joe Biden have signed a formal agreement under which the two countries will work together to develop solar, wind and storage technologies, coordinate the supply of critical minerals, develop new battery technologies and support emerging hydrogen markets. The pair signed the Climate, Critical Minerals and Clean Energy Transformation Agreement at a bilateral meeting held on the sidelines of the annual G7 summit in Japan over the weekend.
“Australia and the United States will deliver sustainable, sustainable and safe critical minerals and clean energy technologies to the world,” the leaders said in a joint statement. “We intend to identify areas where Australia and the US can coordinate the development of our clean energy industrial base, including but not limited to solar, wind, storage and clean hydrogen materials and technologies.”
Albanese said the joint initiative is the “biggest action of any country” to combat climate change and direct investment towards clean energy conversion. “And if we think about industries like hydrogen, without this support, hydrogen-based industries would have a huge incentive to locate in the United States,” he said.
Mr Albanese said the deal would open up new opportunities for Australian manufacturers and suppliers and help address concerns that Australian companies would be disadvantaged by the impressive subsidies provided by the US anti-inflation law.
“So the big risk of the Inflation Reduction Act … is capital leaving Australia for the US. This is about addressing that. This is about creating a huge opportunity for Australia,” he said.
A climate change action plan is due to be drawn up by the end of the year, and a new ministerial-level dialogue will be established between Australia and the US to encourage closer industrial cooperation and accelerate progress towards zero emissions.
Hailing the deal as a “huge step forward” in the fight against the climate crisis, Biden said climate and clean energy had become the “third pillar” of the Australia-US alliance, alongside defense and economic cooperation.
“This agreement can enable the expansion and diversification of clean energy supply chains, especially when it comes to critical materials,” Biden said.