Huge injection of $1.1b up for grabs in Chris Bowen’s bid to kick-start domestic biofuel industry

Producers looking to make fuels domestically from canola, sorghum, sugar or waste can share $1.1 billion in incentives and grants designed to turbocharge the biofuel industry.

The Government wants to stimulate private investment and set up strong local supply chains of more sustainable fuels for trucks, cargo ships and planes.

It anticipates the first production of “drop-in” fuels – direct substitutes that work in existing engines – will start from 2029.

Energy and Climate Change Minister Chris Bowen said the $1.1 billion funding announced on Wednesday built on an existing $250 million allocated to low carbon liquid fuel research and development

“Making cleaner fuels here, from Australian feedstocks, creates the path for emissions reduction in sectors that are hardest to clean up, like plane travel and construction machines,” he said.

There were already 2 billion litres worth of projects in the pipeline.

The Low Carbon Fuels Alliance said the funds signalled to international investors that Australia was open for business on this new frontier.

National Farmers Federation interim chief executive Su McCluskey said Australian farmers were already supplying biofuel producers overseas and would welcome the establishment of a domestic industry.