The Australian Senate has passed the Critical Minerals Production Tax Incentive (CMPTI) and the Hydrogen Production Tax Incentive (HPTI), prompting a show of support from Fortescue Metals chief executive officer Dino Otranto.
The legislation is part of the Future Made in Australia (Production Tax Credit and Other Measures) Bill 2024.
The CMPTI entitles companies to claim 10 per cent expenditure for their activities related to the processing and refining of Australia’s 31 critical minerals, including copper, lithium and vanadium.
The HPTI will see hydrogen producers receive a tax incentive of $2 per kilogram of renewable hydrogen produced.
Participants in either scheme can claim for up to 10 years per project between 2027 and 2040.
The incentives will be provided once projects are up and running, producing hydrogen or processing critical minerals used in products like wind turbines, solar panels and electric vehicles
Fortescue has joined the chorus of industry bodies and players welcoming the HPTI in particular, as it has been a vocal proponent of using ‘green hydrogen’ to decarbonise its mining and shipping fleets.
“The passing of the Hydrogen Production Tax Incentive is a critical step in driving investment in green hydrogen – something we need an abundance of if we are to build a green iron metal industry in Australia,” Otranto said.
“By reducing production costs, this will pave the way for a more competitive, robust and scalable green hydrogen industry.”
Otranto said the new incentives will be integral to driving decarbonisation to enable industry to achieve real zero.
“Real zero takes real action and demands real leadership,” he said.
“These government measures are important steps in raising Australia’s ambition and allowing our nation to tackle climate change head on.”
