Federal budget 2025: the quiet renewable revolution continues

A quick CTRL+F for “climate” in this year’s 64-page federal budget overview reveals... nothing.  

Just last year, Treasurer Jim Chalmers used the budget speech to talk a big game on Australia’s path to net zero. You'll have to dig deep into the supplementary papers to find any mention of net zero this year.  

Climate change has fallen out of the headlines with cost-of-living relief very much the focus of this federal budget. But scratching the surface of the budget, the renewable energy revolution is alive and well.  

Cost of living relief in the spotlight 

The Treasurer announced that every Australian will benefit from tax cuts next year, with the average earner set to have an extra $536 in their pocket each year.  

More relief was announced in the form of $1.8 billion to extend energy bill relief to the end of the year for every household and small businesses and wiping 20% off all student debts and lifting the repayment thresholds.  

The government aims to drive up wages too, with $2.6 billion for a wage increase for aged care nurses and measures to ban non‑compete clauses for low and middle-income earners to free people up to switch jobs.  

The big supermarkets got a warning, with the ACCC’s powers boosted specifically to fight shrinkflation and helping farmers and suppliers get a fairer deal from Coles and Woollies.   

The affordability of healthcare is on the agenda too, with cheaper medicines on the Pharmaceutical Benefits Scheme (PBS) and $8.5 billion to make more GP visits bulk billed.  

Investing in the energy transition   

While tax cuts will be dominating the headlines, this budget did deliver some serious investments in renewable energy.  

Specifically, the budget included an $8 billion additional investment in renewable energy and low emissions technologies through a $2 billion expansion of the Clean Energy Finance Corporation.  

This comes in the form of $36.9 million in spending to enhance the use of existing grid infrastructure and a $10 million Accelerated Connections Fund to reduce grid bottlenecks. 

The budget also prioritised unlocking private investment in the materials, technology and infrastructure that will power the energy transition.  

There’s $13.7 billion in hydrogen and critical minerals production tax incentives alongside $1.5 billion in support for priority areas through the Future Made in Australia Innovation Fund. Those priority areas have been identified as green metals, clean energy technology manufacturing capabilities and low carbon liquid fuels.  

“Green metals” refers to refers to aluminium, steel and iron produced sustainably, aiming for carbon-neutral or even carbon-negative production.  

The Albanese government had previously announced the $1 billion Green Iron Investment Fund to accelerate the development of this industry alongside a $2 billion Green Aluminium Production Credit to support Australian aluminium smelters to transition to renewable energy.  

From September this year, the government will be implementing a “Front Door” for investors in major transformational proposals with a specific focus on renewable energy projects. This Front Door is aimed at unlocking private capital to fund the energy transition, and the superannuation sector could be part of that. 

In 2021, Future Super funded research from the University of Technology Sydney finding that just 7.2% of super investment, in the period up to 2030, could transition Australia’s power sector to 100% renewable energy.  

So we’re all for measures to make it easier to make that happen! We’ll have to wait and see how this policy unfolds though.