Australia has green fuel potential: Superpower Institute

Australia has potential to be a major player in producing green shipping fuel, according to The Superpower Institute.

The institute's chair Rod Sims spoke of the urgency for Australia to make a move in becoming a supplier of green energy intensive exports as other countries are already afoot.

"There is much talk of wanting consumers to demand more green products, and for industry to make them.  But the barriers to Australia realising our superpower potential do not lie with consumers and industry; to focus there is a dead end that will delay progress. Government policies must lead this effort," he recently told the 5th Maritime Decarbonisation Summit.

While many people say making green products is more costly, Sims said this is only possible in ignoring the economics of climate change.

"We would not have a problem in making the energy transition if green products were cheaper than those produced by fossil fuels. But for the moment they are not. Governments have, however, largely uniformly said that fossil fuels are doing serious harm to our environment and may soon irreparably damage our planet."

One of the areas Australia should focus on is pursuing the production of green shipping fuels based on foresight from the International Maritime Organisation (IMO).

Last April, the IMO approved its draft net-zero regulations for the international shipping sector.

"The IMO Net-zero Framework needs to be formally adopted in October this year and will then come into force in 2027. It covers ocean going vessels over 5000 gross tonnage, which account for approximately 85% of international shipping emissions," he said.

"The IMO Net-zero Framework is the first in the world to combine mandatory emissions limits and carbon pricing across an entire industry sector. This represents the first global sectoral price on carbon, an amazing milestone of which the shipping industry should feel proud."

In Australia, the Bell Bay Powerfuels project in Tasmania is targeting production of 300,000 tonnes a year of renewable methanol for the shipping industry beginning in 2028.

Sims said the Tasmanian project is the most advanced of the superpower industries to proceed in Australia.

"So, Australia will hopefully soon make a start but much more is needed if we are to achieve our green fuel potential," he said.

"The IMO, in providing an effective world carbon price for shipping fuel, is providing Australia an opportunity. The question is whether we will grasp it now. Do so and we boost Australia's economy and productivity, and provide a hedge against declining exports of fossil fuels."