Small Australian manufacturers will be encouraged to extract the fossil fuels from their production lines with a $10 million fund designed to decarbonise forgotten areas within industry.
Projects involving metal, coatings and even cooking will be eligible for investments under the scheme that could reach into fields as diverse as the food and beverage market and automotive and construction industries.
The Australian Renewable Energy Agency (ARENA) announced its multimillion-dollar support for the Advanced Manufacturing Growth Centre on Thursday, revealing it would consider projects worth up to $1 million.
The announcement comes after recent government investments in decarbonisation projects for sustainable fuels and transport, and as the nation strives to reduce greenhouse emissions by up to 70 per cent in 2035.
Australian owned and operated manufactures with fewer than 200 staff members will be eligible to apply for funding from the program, with company investments matched by the agency.
Successful applicants would have to prove they could reduce fossil fuel use by electrification or other low-emission technologies, agency chief executive Darren Miller said, and would share their findings with the wider industry.
"Australia cannot reach net zero without transforming how we make the materials and goods that underpin our economy," he said.
"This funding extends ARENA's work in industrial decarbonisation to reach small and medium-sized manufacturers, helping them deploy practical solutions and demonstrate approaches that can be replicated across the industry."
Priority would be given to projects involving metal processing, surface treatments, and industrial applications that use steam, centre managing director Dr Jens Goennemann said, to make the biggest environmental impact across the widest field.
"To advance Australia's industrial capability, all areas of manufacturing must be engaged," he said.
"This fund supports skills development, operational transition to lower emissions, and sharing knowledge to accelerate industry-wide progress."
The scheme will remain open until December 2027, and projects must be completed before April 2028.
Australia has a legislated target to reach net zero emissions by 2050, and the Climate Change Authority introduced an interim goal to cut emissions by 62 to 70 per cent in 2035.
