Australia has launched a $500 million funding program to scale up local battery manufacturing.
The Australian Renewable Energy Agency (ARENA) this week opened applications for the Battery Breakthrough Initiative (BBI).
The initiative, central to the federal government’s National Battery Strategy and Future Made in Australia agenda, will provide capital grants, production incentives and other tailored support to domestic projects.
ARENA CEO Darren Miller says the program is about positioning Australia to play a central role in global energy storage markets.
“Energy storage is a critical enabling technology for our renewable energy future. We know that solar and wind energy can provide us the lowest cost renewable energy generation at scale, but we also need to be able to store it for when it is needed,” Miller said.
“BBI will enhance Australia’s battery manufacturing capability, improve supply chain resilience and battery manufacturing processes, and foster innovation.”
Funding will target three main areas:
- active materials, including cathode and anode materials and electrolytes
- electrochemical cell and component manufacture
- battery pack assembly, including modules and flow battery stacks
Applications are merit-based and open until funds are exhausted or the scheme is extended. ARENA has encouraged proponents to engage early before submitting through the online portal, which opens this month. Two webinars in September will provide further guidance.
The Battery Breakthrough Initiative builds on policy measures outlined in the National Battery Strategy, which highlights Australia’s reliance on imported components despite being the world’s largest lithium producer.
While Australia supplies about 45 per cent of global lithium, it manufactures less than 1 per cent of battery materials and components.
The strategy notes that the global battery market is projected to expand five-fold by 2030, with 96 per cent of value captured downstream of mining.
Domestic demand is also surging: the Australian Energy Market Operator forecasts grid storage needs to rise from 19 GW in 2030 to 43 GW by 2040, with over half at household and community scale.
The government’s budget allocated a total of $523.2 million for BBI, alongside $20.3 million to build industry skills and innovation capacity.
These measures are designed to help manufacturers overcome commercialisation hurdles, reduce reliance on concentrated offshore supply chains and create opportunities across stationary storage, transport electrification, and battery recycling.
Australia is also positioning itself to capture export opportunities in high-value battery active materials, with products qualifying for US Inflation Reduction Act subsidies if integrated into American supply chains.
ARENA will administer the BBI in partnership with the Department of Industry, Science and Resources. Guidelines, FAQs and supporting documents are available on the agency’s website.