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Energy and Emissions Reduction Agreement with SA

The Australian Government and South Australian Government have signed a $1.08 billion State Energy and Emissions Reduction Deal.

Under the agreement, the governments will create additional dispatchable generation to:

  • deliver affordable and reliable power
  • unlock gas supplies to help prevent shortfalls in the market
  • kick-start works on a new interconnector between South Australia and NSW
  • invest in key emissions reduction projects.

The Commonwealth will contribute $660 million and South Australia will provide $422 million as part of the agreement.

Key components of the deal include:

  • a gas target of an additional 50PJ (petajoules) per year by the end of 2023
  • a stretch target of 80PJ per year by 2030 to increase gas supply in South Australia and the east coast gas market
  • $400 million investment in projects including carbon capture and storage, electric vehicles, hydrogen in South Australia
  • up to $100 million joint support for Project EnergyConnect to boost the flow of power between South Australia and NSW
  • up to $110 million for solar thermal and other storage projects in South Australia.

Prime Minister Scott Morrison said the bilateral agreement is key to ensuring South Australians get a fair deal on energy.

‘Families and businesses need affordable, reliable power. That is what reduces prices and creates jobs. Australians also want to ensure we are doing everything we responsibly can to combat climate change,’ the Prime Minister said. ‘This agreement will support investment and more jobs in South Australia and will be a key driver of our economic recovery from COVID-19.’

The Australian Government is working with state and territory governments to establish agreements on energy and emissions reduction projects.

See the Ministerial media release.

Bilateral energy and emissions reduction agreements

Photo: SA Premier Steven Marshall with Prime Minister Scott Morrison in Clare Valley, SA.