Net zero: $1bn boost for green bank, power to invest in carbon capture and storage

Prime Minister Scott Morrison will on Wednesday commit more funding to the Clean Energy Finance Corporation, as he continues to sell his tech-focused climate and energy agenda after returning from the Glasgow summit.

The government-owned green bank would then look to secure an additional $500 million in private sector investment.

The new fund would be used to invest in small start-ups which are developing "early stage" technologies to cut emissions, such as improved solar panels, and techniques to slash methane emissions from cattle or pollution from steel and aluminum production.

The Morrison government will need to pass legislation to boost the budget of the Clean Energy Finance Corporation and create the so-called "Low Emissions Technology Commercialisation Fund".

The legislation would also expand the remit of the green bank to allow it to invest in carbon capture and storage, a technology favored by the Morrison government but strongly opposed and dismissed as unviable by environmental groups and industry figures such as Andrew "Twiggy" Forrest.

The Morrison government has been pushing to expand the scope of both the Clean Energy Finance Corporation and the Australian Renewable Energy Agency to allow them to fund non-renewables.

But they've faced strong resistance at each turn from the Greens and Labor, with their latest attempt set to trigger another political fight on eve of the next federal election.

The new $1 billion fund will not be used to fund large-scale carbon capture and storage projects, such as Santos' new venture in South Australia, but rather smaller initiatives which might be considered too risky by private investors.

"The fund will support Australian innovators to develop their intellectual property and grow their businesses in Australia," Energy and Emissions Reduction Minister Angus Taylor said.

"It will address a gap in the Australian market, where currently small, complex, technology-focused start-ups can be considered to be too risky to finance.

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The announcement comes after another political stoush over electric cars erupted on Tuesday, after Mr Morrison announced a strategy to support an influx of vehicles on Australia's roads in the next decade.

Mr Morrison and his colleagues hammered Bill Shorten over electric vehicles at the 2019 federal election, claiming that the former opposition leader's ambition to have EVs make up half of new car sales by 2030 would "end the weekend".

The Prime Minister has walked back that rhetoric over the past two years, and was on Tuesday talking up the transition as he released the government's long-awaited electric vehicle strategy.

Industry and green groups were quick to criticise the government's plan, which ignored calls for subsidies to reduce the upfront cost of electric cars, new fuel efficiency standards or an end date for the sale of petrol and diesel vehicles.

The government will instead partner with the private sector to boost funding for charging infrastructure as part of a $178 million expansion of its Future Fuels Fund.

It estimates that charging stations at more than 400 businesses, 50,000 households and more than 1000 public access points will be installed as a result of its approach.

The Coalition believes the shift to electric vehicles is already happening without incentives, pointing to figures which show sales in the first six months of this year are already 26 per cent higher than for all of 2020.

Mr Morrison was challenged on his past anti-EV rhetoric when he visited Toyota's Hydrogen Centre in Melbourne on Tuesday morning to unveil the plan.

He was unrepentant, claiming that he didn't campaign against electric cars at the 2019 election - only Mr Shorten's policies.

"I was against Bill Shorten's mandate policy, trying to tell people what to do with their lives, what cars they were supposed to drive and where they could drive," Mr Morrison said.

"I don't agree with that. I still don't agree with it, and our policy takes a very different approach. Labor loves interfering in your life, they love telling you what to do. They don't like our plan because it doesn't tax you and doesn't force you to do anything."

Mr Morrison was questioned over his mocking of Mr Shorten's proposal to create a network of charging stations - now is a key feature of the Coalition's strategy.

He was again remorseless, saying technology had advanced significantly over the past few years.

Labor leader Anthony Albanese on Tuesday accused the government of being "scared of change" as Australia lag behinds the rest of the world in the uptake of electric vehicles.

Mr Albanese has ruled taking an electric vehicle sales target to the next election, but has already committed to making vehicles cheaper through through exemptions on import tariffs and fringe benefits taxes.

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