$500M Battery Manufacturing Initiative Boosts Australia’s Energy Storage Industry

Australia has launched a $500 million funding program designed to expand domestic battery production and strengthen the local energy storage sector. The Battery Breakthrough Initiative (BBI) now accepts applications for projects seeking capital support, production incentives, and tailored assistance to advance local battery manufacturing capabilities.

This initiative is a central part of the national strategy to promote domestic battery production and support sustainable energy infrastructure. It aims to position Australia as a competitive player in the global energy storage market by improving manufacturing processes, increasing supply chain resilience, and fostering innovation.

Funding under the initiative focuses on three key areas:

• Active materials, including cathode and anode materials, and electrolytes
• Electrochemical cell and component production
• Battery pack assembly, including modules and flow battery systems

Applications are merit-based and will remain open until allocated funds are fully committed or the scheme is extended. Early engagement is encouraged, and informational webinars provide guidance for prospective applicants.

The BBI builds on policy measures outlined in the National Battery Strategy, which highlights Australia’s reliance on imported components despite being one of the world’s largest lithium producers. While the country supplies around 45% of global lithium, less than 1% of battery materials and components are manufactured domestically. The initiative addresses this gap and seeks to capture more value within the local supply chain, preparing for a global battery market projected to grow fivefold by 2030.

Rising domestic demand underscores the importance of local battery production. Forecasts indicate that grid storage needs could increase from 19 GW in 2030 to 43 GW by 2040, with household and community-scale storage accounting for more than half of this growth.

The federal budget allocates $523.2 million to the BBI, alongside $20.3 million to build industry skills and innovation capacity. These measures aim to help domestic manufacturers overcome commercialization challenges, reduce dependency on concentrated offshore supply chains, and create opportunities across stationary storage, transport electrification, and battery recycling.

Additionally, Australia is positioning itself to capture export opportunities in high-value battery materials, with products developed through the initiative potentially qualifying for international incentives, enhancing global competitiveness.

The program is administered by the national energy agency in collaboration with relevant government departments, with guidelines, FAQs, and application documents available online. The funding initiative represents a significant step toward a stronger, locally supported energy storage ecosystem, promoting sustainability, innovation, and economic growth in Australia’s battery manufacturing sector.