The global energy sector is moving steadily away from oil and gas, pushing countries that once depended on traditional fuels to invest in cleaner alternatives. Australia has now joined this shift, with the federal government announcing a major funding plan to support domestic production of low-carbon liquid fuels, following long-standing demands from the farming sector, reports Energies Media.
Under a new Clean Fuels Program, the government will invest AU$1.1 billion (around $732 million) in the biofuel sector over the next 10 years. The move marks a change in direction for Australia, which has historically relied on oil and gas exports, as more countries focus on cleaner fuel sources.
The government plans to begin construction of Australia’s first large-scale biofuel refinery in 2026. Funding under the decade-long program will be used to draw private investment into biofuels and related industries, with the aim of turning Australia into a key player in global biofuel production.
Agriculture is expected to be central to the strategy. Australia is a major producer of crops such as canola, sugarcane and sorghum, which are widely used in biofuel production worldwide. At present, most of these crops are exported, while the country imports much of its fuel.
For years, farmers have urged the government to invest in biofuels, arguing that Australia has both the land and resources to build a strong domestic industry. The new investment is being seen as a response to those calls and a step towards creating new markets for agricultural output.
In a government statement, officials said Australia’s advanced farming methods and access to renewable energy give it a strong advantage in producing cleaner fuels needed by aviation, shipping and heavy transport as countries work to cut emissions.
The government also said the biofuel push would complement growth in renewable energy and help build new industries.
Treasurer Jim Chalmers said the funding represents an early commitment to developing a new sector and ensuring Australia benefits economically from the global shift towards lower-emission energy.
Alongside biofuels, Australia continues to expand its renewable energy capacity through large projects such as the Western Green Energy Hub, as it works to diversify its energy mix and respond to changes in the global energy market.
