TOM CONNELL: Well, it’s been many years since Australia’s had a car-making industry. Of course, the car-makers left when the subsidies ended in this country eventually finally packing up shop years ago. But perhaps we could re-enter the fold making car batteries, and it might be more lucrative than you think in the electric vehicle era. 

Joining me now is Industry Minister Ed Husic who’s in Singapore and has been in Indonesia. Thanks very much for your time. 

ED HUSIC, MINISTER FOR INDUSTRY AND SCIENCE: Thanks, Tom. 

TOM CONNELL: So it’s been spruiked by the PM as a possible partnership with Indonesia. It’s a big car making nation. Is that our future, and how big could this industry be, car battery manufacturing, in Australia? 

ED HUSIC: Thanks, Tom. Well obviously being here in Singapore and also working with our friends in Indonesia, I mean, both are great friends, we have shared ambitions particularly around manufacturing in new ways. 

The Indonesians are very focused on manufacturing EV vehicles, and I’ve visited some of those production facilities while I was in Jakarta. But we can work together with our critical minerals. We possess a lot of lithium; they possess a lot of nickel. They’re very keen on us working together. And if we get processing and manufacturing right, it’s good for lower emissions and more jobs for both countries. 

And these are the type of things that were discussed when the leaders met in Sydney in early July, and we haven’t wasted time. I’m here as a result of those discussions that we had in Sydney between the Indonesian President and Prime Minister Albanese back in early July. And in meeting with ministers here we’re looking at how we can take that further, how we can work out how we can manufacture batteries that we need for various reasons both in Australia and Indonesia. 

TOM CONNELL: So manufacturing in both countries. For it to happen in Australia, would we be talking about significant government subsidies? Is that needed in your view? 

ED HUSIC: At the moment I’m in the process of developing the National Battery Strategy to see how we can scale up how we can lean into the various parts of the battery value chain. We do really well on mining and refining. We’ve got to take those extra steps in processing and manufacture. So we’re working through that and we hope to release that in due course. 

And things like the National Reconstruction Fund, providing critical growth finance in areas like this, we’ve got a target fund in the National Reconstruction Fund, around about $3 billion, to see what we can do on zero or low emissions technology. And we also want to value add in resources, which is also a separate target fund of the National Reconstruction Fund. 

We want to make sure that businesses who step forward have got a sustainable game plan, they can deliver return on investment for the taxpayer, and that we build something that’s long lasting in the economy. So, you know, we’re looking at the financing arrangements, but we want them to be able to stand on their own two feet and deliver what’s needed for the economy both here and potentially as export opportunities offshore. 

TOM CONNELL: Okay. So you’re talking about being able to access those loans but not something that would only work with subsidies? It would have to stand on its own two feet, the industry? 

ED HUSIC: Yeah, we are going through the process of looking at what we need to do to support growing our capability onshore. And that can be a mix. Just as we’ve seen with the Clean Energy Financing Corporation and ARENA in that renewable energy space where we can then build on that further in areas of critical need like, for example, energy storage systems. 

It’s not just about cars, Tom; it’s about making sure that we’ve got storage systems for homes, for businesses, for industry at larger scale. And there’ll be different things that are being considered or worked on in universities, in research, that we’ve got to commercialise. How do we have something that keeps those firms along their development time line so that we can build capability in Australia. 

That’s going to need a mix of thing. It may be grants, it may be some of the concessional finance. How we get that together is going to be really important, but we can’t miss the opportunity to ensure that we build that capability onshore. Australians are expecting it. 

TOM CONNELL: All right. It will probably also need – well, it will also need competitive power prices. The latest power prices were down, but the March quarter the highest in some 18 years. And the forecast for the rest of the year is for power prices to go up. This is going to hurt industry, isn’t it? 

ED HUSIC: You will recall leading into the October budget last year Treasury forecast some pretty alarming projections about where power prices would go. That’s what prompted us to look at what we can do to bring those prices down. We recalled the Parliament. We brought in the price caps. We delivered energy price relief for up to 5 million homes. And as a result of some of that work, you can see drops in power prices from where they were predicted to be by 25 per cent. 

There’s always more to do. We’re very focused on that as a government. We particularly listen to manufacturers in my own arena as the Industry Minister to deliver that. We’ve brought in a new mandatory code to make it easier to negotiate power contracts or power and energy contracts as well for industry too, which has been welcomed by users as well. So, you know, we’ve done some work. We’re doing more, and if we need to act further, then obviously that will be considered. 

TOM CONNELL: You’ve been pretty forthright on this. So, yeah, what you noted there is true – that changes have been made and compared to previous forecasts we’re avoiding the worst-case scenario, but given your forthrightness in the past, wouldn’t you still say considering our natural advantage in all things energy we’re still just paying too much as a nation for our energy? 

ED HUSIC: I always want to see prices go down wherever we can see that occur. We do have a natural resource. That should confer economic advantage on the country. We have taken great strides in reducing prices from where they were and where they were predicted to go as well. So we’ve done a lot of work there. 

And I do think – and I think Australians do recognise too – we should not be paying European prices for an Australian resource. And we have, you know, taken – made some hard calls to bring that about, but we’ve done the right thing as well. And I think people recognise that. Clearly there’ll be people who – 

TOM CONNELL: But you want more action? Is it fair to say that? 

ED HUSIC: Well, no, I think we’ve taken a heck of a lot of action, Tom. I think people know that we have. I know there will be some people – and the point I was about to make – there will always be people that want to see prices lower. But, you know, what we’re seeing is we’re seeing that suppression of power prices going up in the way that they were predicted in October, and I think that is a good thing ultimately. 

TOM CONNELL: Okay. But on the more action front there are you saying for now you’re relatively happy with the way the market is working, at least for now? 

ED HUSIC: We – as you’ll recall, we consulted with industry, particularly users, especially in terms of gas, over the cost of the last few months. That was factored in to the development of the mandatory code of conduct that’s designed to improve the bargaining framework. I spoke with a lot of my stakeholders in that space who were very comfortable with the direction of the way things were going. 

And I think they have said they want to engage and they want to in good faith utilise that mandatory code for their benefit as well. And I think producers have expressed their views, positive views, about that too. 

TOM CONNELL: All right. 

ED HUSIC: So at this point in time it seems like things are working quite well. If there are any issues – and I’m keeping a close eye on things and I’m talking with industry stakeholders and manufacturers – if there’s anything that they believe that we need to look at, we’re all ears. But I think at this stage, so far so good. But having said that – 

TOM CONNELL: All right. As I said, there are forecasts – 

ED HUSIC: Yes, absolutely. Let me just rephrase that, if I may. 

TOM CONNELL: Sure. 

ED HUSIC: We understand, we want to be able to keep that downward pressure on prices. It is a challenge obviously. We’ve taken those steps. If we need to do more we’ll listen to people and see what we need to do. 

TOM CONNELL: Okay. Yeah, as I said, forecast that they are going to go up. We’ll keep an eye on them and I’m sure talk to you about it again in the future. Ed Husic, thank you.