Quotas on steel in Anthony Albanese’s mix for energy

Anthony Albanese will impose local content requirements and pump $500m into green manufacturing to prop-up his clean energy and wind turbine agenda, as Peter Dutton attacked green hydrogen as a ‘hoax’.

Anthony Albanese at the Building a Bigger, Better SA Forum in Adelaide on Friday. Picture: Brenton Edwards / NewsWire

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Anthony Albanese will impose protectionist local content requirements and pump $500m into green manufacturing to prop-up his clean energy and wind turbine agenda, as Peter Dutton attacked green hydrogen as a “hoax”.

With Australia bracing for exposure from Donald Trump’s expanding trade war, the Prime Minister on Friday night confirmed he would shield the nation’s steel industry by putting in place “new ambitious targets” for local content.

Amid industry concerns that cheap Chinese steel could be dumped in Australia in the wake of Mr Trump’s steel and aluminium tariffs, Mr Albanese will use a speech in the NSW Illawarra region to double down on building wind towers, transmission infrastructure and large scale solar.

After announcing a $2.4bn bailout package for the Whyalla steelworks in partnership with South Australia, Mr Albanese flew into Wollongong to announce he would “put Australian steel in every link of the supply chain”.

In addition to $2bn to prop-up a ‘green aluminium’ industry, Labor will commit $500m from the $1.7bn Future Made in Australia Innovation Fund to focus on domestic manufacturing of wind turbines, which are overwhelmingly imported from China.

“Every new wind tower needs hundreds of tonnes of steel. Why should that steel come from anywhere but here? This is a steel city. Steel-making in the Illawarra has delivered generations of good blue collar jobs,” Mr Albanese said.

“Our economic plan is about keeping your community and your industry strong in the face of global uncertainty. Turning Australian iron into Australian steel. And turning steel into fabricated steel and manufactured steel products for Australia to use – and the world to buy.

“More blue collar jobs in green metals. And more steel in wind towers and transmission infrastructure and large scale solar.”

The proposed rules floated by Mr Albanese would require governments and businesses to increase their purchases of steel products made in Australia, complementing Labor’s recent round of protectionist policies designed to spur a revitalisation in domestic manufacturing.

The rules could be implemented either via a direct requirement for a certain percentage of steel purchased to come from domestic producers, or alternatively, by making access to government subsidies and concessions conditional on purchasing Australian products.

Trade experts, economists and the Productivity Commission have previously questioned the impact of local content requirements, noting that similar policies have resulted in higher prices and risk undermining Australia’s competitive industries.

“While these policies may achieve certain short-run objectives, they can reduce overall income levels when they redirect resources away from sectors in which a nation enjoys a comparative advantage,” a recent Productivity Commission report found.

With Labor facing pockets of anger over its aggressive net zero transition and offshore wind zones in traditional ALP mining and manufacturing seats across the NSW Hunter and Illawarra, the Prime Minister urged voters to give him another go because it would take “more than one-term of government” to finish the job.

“It’s the difference between making three years of progress – or creating a generation of opportunity. It’s the difference between cleaning up the mess of the last decade – or seizing the opportunities of the next decade. The difference between laying the foundations – and finishing the build,” he said.

“At this election we are up against that same plan, being pushed by the same people. Because Peter Dutton wasn’t a bit player or a bystander in the decade the Liberals spent in power. He made the mess. He dug the hole. He put bulk-billing in free fall and broke the migration system.”

Speaking in Adelaide on Friday, Mr Dutton committed the Coalition to protecting the local steel industry but criticised Mr Albanese for presiding over a “green hydrogen hoax”.

“(Whyalla is) going to require gas and it’s going to require a significant amount of gas,’’ Mr Dutton said.

“The green hydrogen hoax that Anthony Albanese has presided over is not going to work, and Premier (Peter) Malinauskas has called that out. I want to make sure that we can support the workers and we can support a sustainable industry, but we’re not going to do that through government ownership and through green hydrogen fantasy projects.

Additional reporting: Cameron England