That was the question put to ACAP Executive Director Renate Egan in late August when she made a representation at a public hearing for the Inquiry into Future Made in Australia Bill 2024.
The Bill passed the House of Representatives on September 9, 2024, and will move to the Senate for debate. Professor Egan appeared alongside Ms Dani Alexander, Chief Executive Officer UNSW Energy Institute, and Professor Iain MacGill, Energy Systems and Joint Director UNSW Collaboration on Energy and Environmental Markets, among others.
Professor Egan responded to the question posed by Senator David Van (Independent), “That is a decision industry needs to make, but – and this is what was documented in the [Silicon to Solar] reports – we can't start from scratch.”
“We must build on the successes of these Chinese industries and companies. To be clear, it's not China; it's Chinese companies, many of which are not government owned and are listed on international stock exchanges. They are generations ahead technically of much of the international competition, and I think working with them is likely to be the greatest path for success.”
“Australia is particularly well-positioned, both in our relationships and technically, to leverage that in the solar and probably in the battery space and, in doing so, access global markets for Australian manufacturing.
“International diversity is happening already, with other countries investing in localising manufacturing.
“They are doing so for their local markets and are not likely to produce enough for export, whereas Australia has a smaller local market and we can produce enough for export, so there's an export opportunity, particularly in the poly-silicon space.
“It's really important to note about the solar manufacturing initiative that the language is often around what's called 'module assembly', and that's only ever going to be a small part of an initiative. Most of the initiatives should be upstream in other areas around, for instance, poly-silicon processing, which is capital intensive and where we have the raw materials in quartz and we will have in green energy.”
Would you advocate for an incremental step towards doing that [solar manufacturing] rather than just partnering with a Chinese firm or firms to have them set up here?
Senator David Van put the above question to Egan who responded, “Those will need to be industry-based decisions. I imagine joint ventures will work, but they should be predominantly Australian owned. In doing so, the manufacturing capability requires not only input materials but the equipment and maintaining that equipment, so having really good working relationships with the suppliers along the supply chain will be essential.
“For that reason, Australia is particularly well placed to benefit. We are going to invest hundreds of millions of dollars or billions of dollars in solar into our future, and we should play in that supply chain."
Egan added, “If we don't participate we will miss an opportunity to do so. For decades now we have said, 'How did we miss the opportunity in 2000 to embrace what we had developed?'
“The opportunity is with us now to embrace our investments, our continuous improvement, our depth of knowledge and our relationships with the people and industries which have succeeded, to position Australia both to supply its own energy and to supply export markets.
“We also ought to develop relationships with India as it develops its market to diversify ours and other nations markets.”
Is there PV technology coming forward that's leaps and bounds ahead that we can hold onto and develop an industry off, rather than farming it out to other countries?
Professor Egan responded to this question from Senator Van; “That's a terrific question. The industry's changing really, really quickly, and the lead manufacturers now realise that they can see the ceiling –they compete on the performance of the silicon-based technologies – in where they can take the silicon technology, and [they know] that they need to go beyond that.
“So they're actually actively coming and working with us on the next-generation technologies. This has happened much faster than I thought it would. I was thinking that this would still be another decade away, but it's happening now.
“We already have a substantial amount of research, backed by ARENA over the last decade, that is fundamental to the next generation of technologies, and we should hang onto that.
“If we want to have an industry based on it when it's ready – that may well be only five years away – we need to have an industry based on the current technology to be able to leverage the expertise.
“You can't go into these sectors small. You have to go in with significant capacity to leverage the economies of scale. So, yes: there's future IP that we can hold onto and anticipate using as the industry and the technology develop.
Professor Renate Egan is an expert in solar energy engineering with 20 years of international industry experience. She leads the development of technoeconomic analysis in solar energy at UNSW and contributed to the 2023 Silicon-to-Solar study that informed the government's $1 billion Solar Sunshot initiative.
This article drew from the uncorrected proof of evidence taken before the Economic Legislation Committee on Wednesday, 28 August 2024, for the inquiry into the provisions of Future Made in Australia Bill 2024 and the Future Made in Australia (Omnibus Amendments No. 1) Bill 2024.
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