A $500 million program to support Australian battery manufacturing has opened, offering capital grants and production incentives to local companies as international competition grows.
The Battery Breakthrough initiative, announced in last year’s federal Budget, is designed to provide targeted funding to high-value battery products and scale operations across the value chain.
A central plank of the Albanese government’s National Battery Strategy, the program will focus on areas like stationary energy storage and the production of battery-active materials using Australian critical minerals and clean energy.
“Batteries are a critical component of the global move to reduce carbon emissions and there is a huge opportunity for Australia to be part of this global demand,” Industry minister Tim Ayres said as the program opened on Tuesday.
“Australia’s got the raw materials, a strong research sector and a range of companies deeply engaged on the role of batteries in the clean energy transition, and that’s why I’m so excited to back these home-grown ideas and businesses to deliver a Future Made in Australia.”
According to the program guidelines, funding will be available to projects that enhance Australia’s battery manufacturing capability and commercialise battery manufacturing processes/technologies.
It is designed as an “open, merit-based program” with no cap on funding. Ministerial sign-off will only be required for funding that is greater than $50 million, with ARENA empowered for projects of lesser value.
Last year, industry stakeholders advised the program should support new chemistries and advanced lithium technologies rather than duplicating areas where international competitors already dominate.
The scale of the challenge was underscored this week when Australia’s first lithium-ion battery manufacturer, Energy Renaissance, reportedly collapsed into administration. It came a month after the business celebrated its 10-year anniversary.
The company’s failure highlights the risks facing local manufacturers in a capital-intensive, globally competitive sector, particularly when scaling from proof of concept to commercial production.
The Battery Breakthrough Initiative is pitched as part of the government’s broader Future Made in Australia agenda, which links industrial policy with emissions reduction, supply chain resilience, and domestic economic growth.
Industry watchers put the growth of the global battery market at anywhere between a threefold increase, as forecast by Bain & Company, and up to a sevenfold surge by 2030, according to McKinsey analysis.
With Justin Hendry
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