Critical minerals are an essential input for the energy, transport, aerospace, defence, medical, automotive and telecommunications sectors. The International Energy Agency’s World Energy Outlook 2021 predicts that the demand for critical minerals is expected to increase, especially for those critical minerals used in solar PV plants, wind farms, electric vehicles and battery storage. This prediction becomes evident when considering that the number of electric vehicles, which use many critical minerals, are expected to increase by 30% every year to 2050.
On 16 March 2022, the Australian Government announced the implementation of Australia’s 2022 Critical Minerals Strategy. The aim of the strategy is to expedite growth in the critical minerals sector, expand downstream processing and help meet future global demand.
The new strategy updates the 2019 Critical Minerals Strategy and sets out a more definitive long-term plan to improve access to, and reliability of, critical mineral supplies.
The main funding package includes a commitment of $200 million to the Critical Minerals Accelerator Initiative which will support strategically significant projects in early project stages to fast track them to market and drive investment.
An additional $50 million has been committed over the next three years to implement breakthrough collaborative research through a virtual Critical Minerals Research and Development Centre, headed by Geoscience Australia, CSIRO and the Australian Nuclear Science and Technology Organisation.
The Federal Government also announced an additional $243 million in funding support to four critical mineral and rare earth processing projects under the collaboration stream of the Modern Manufacturing Initiatives. It is expected that the added funding will allow the creation of over 3,400 jobs, and further opportunities over time.
The updated strategy and funding announcements (included as part of the 2022-23 Federal Budget) are welcomed on the back of increasing efforts to develop a thriving and durable critical mineral sector and unlock the industry’s potential to build Australia’s sovereign capability.
The Hamilton Locke team advises across the energy project life cycle – from project development, grid connection, financing, and construction, including the buying and selling of development and operating projects. For more information, please contact Matt Baumgurtel.