A NSW Government website

Overview

As a member of the global ‘Race to Zero’ initiative, NSW wants to lead the nation and the world in driving the opportunities generated by the transition to a net zero economy.

Given the accelerating pace of change and interest in decarbonisation globally, the state’s Net Zero Plan will ensure that NSW is well positioned to deliver clean, reliable and affordable energy that will underpin future prosperity of industries across NSW.

Investment NSW provides free, personalised support for your business, including how to navigate and access funds and grant programs to capitalise on this transformational opportunity.

Our competitive advantage

NSW, including Sydney as Australia’s financial capital, is competitively positioned as a leading location for decarbonising industry due to its:

Sophisticated, diversified economy worth more than half-a-trillion dollars (larger than that of Hong Kong, Malaysia or Singapore).

Strategic location at the centre of the National Electricity Market (NEM), and as a leading financial hub in the Indo-Pacific region. 

Leadership on inbound investment in Australia and export to international markets.

Implementation of some of Australia’s most forward-thinking policy frameworks on climate and energy, and economic and regional development.

Highly capable and diverse workforce – the largest and most educated in Australia. 

Leading innovation ecosystem with half of all Australian start-up founders based in NSW, and the highest level of business expenditure on research and development of any Australian state or territory.

Green hydrogen

It is anticipated that the green hydrogen industry alone could support between $80 and 270 billion of investment by 2050 and will help drive emissions reductions in sectors that are hard to decarbonise, such as transport and energy. NSW has the resources, infrastructure and ambition to build an integrated green hydrogen ecosystem spanning international export, as well as a range of domestic applications across multiple sectors. 

To support this fast-emerging industry, our new NSW Hydrogen Strategy provides a nation leading framework and $3 billion of incentives to set the state up as a global green hydrogen leader. With the largest pool of incentives of any jurisdiction in Australia, this strategy is forecast to more than halve the cost of green hydrogen production in NSW, making NSW the best place to invest in hydrogen in the world. It is set to increase the size of the NSW economy by more than $600 million each year by 2030.

Its strategic actions target areas, such as: 

  • domestic hub development and demand creation
  • export of green hydrogen and hydrogen-derived products
  • technology innovation
  • skills development
  • social licence
  • appropriate regulatory reform. 

Critical minerals and battery ecosystem

It is projected that global cumulative investment in energy storage from 2020 to 2050 will be US$964 billion.

NSW is strongly positioned to develop local industries around a whole-of-value-chain battery ecosystem in the state, ranging from critical mineral extraction through to battery recycling, while also supporting decarbonisation of the transport sector (electric passenger vehicles and buses).

NSW has significant untapped potential in critical minerals extraction. As little as 5% of all drilling for minerals in NSW has been deeper than 150 metres, typically focusing on shallow reserves. This means 80% of the state is essentially unexplored, including a diverse range of minerals in central and central-west NSW. 

Sydney as a sustainable finance hub

Home to major domestic and international banks, pension funds and fund managers, Sydney drives Australia’s deep and dynamic private and public capital markets and highly innovative fintech sector. Leveraging its strong position as a financial centre in the Indo-Pacific region, Sydney is forging ahead as a leading sustainable finance hub, possessing deep expertise in the sectors that will be central to the decarbonisation funding challenge. 

Australia’s sustainable bond market is growing rapidly, but still in its infancy compared to other countries. This presents significant room for growth and is why the NSW Government is taking a leadership role in actively implementing initiatives to strengthen and drive the sustainable finance agenda in Australia, leveraging the recommendations set out in the Australian Sustainable Finance Initiative Roadmap

Electricity innovation

NSW is innovating and reforming energy creation and storage to position NSW as a renewable energy global superpower.

NSW has developed a comprehensive Electricity Infrastructure Roadmap laying out the Government’s 20-year plan to transform the state’s electricity system into one that is cheap, clean and reliable. The Roadmap coordinates investment in transmission, generation, storage and firming infrastructure as ageing coal-fired generation plants retire. It includes the build out of infrastructure for Renewable Energy Zones (REZs) in NSW, which is expected to attract $32 billion of private sector investment.

The Roadmap will set NSW ahead of global trends, keeping industries competitive – and attracting new ones – with forecast NSW heavy industry electricity prices indicatively expected to be in the lowest 10% of the Organisation for Economic Co-operation and Development (OECD). It will make it cheaper to do business in NSW at all scales. 

Sustainable transport

The NSW Government is leading the electric transport revolution in Australia with a $490 million investment to help kick-start the state’s pathway to electric vehicles (EV) and fast track the transport sector.

The NSW Electric Vehicle Strategy is the NSW Government’s plan to turbo-charge the EV market making NSW the easiest place to buy and use an EV in Australia. Under the Strategy, stamp duty on EVs will be phased out, drivers will have access to a world-class road network of ultra-fast charging stations, and motorists will be supported to make their next vehicle an EV.

NSW has ambitious targets to transition to a fully electric bus fleet by 2030. The convergence of strong domestic and regional demand for local vehicle and battery manufacturing, together with deep capability in sustainable transport, presents a significant opportunity.

Circular economy

NSW is transitioning to a circular economy to minimise waste and use and reuse resources efficiently, to make them as productive as possible. Analysis shows that NSW could generate $648 billion in direct economic benefits over 20 years through circular economy opportunities in the built environment, mobility and transport, industry, and waste and recycling sectors.

To drive a circular model, NSW has set ambitious waste and recycling targets through its NSW Sustainable Materials and Waste Strategy 2041 (Stage 1:2021-2027). To achieve these targets, the NSW Government is providing $356 million in funding to deliver key policy reforms and priority programs, including to stimulate investment in new processing technologies and capacity across NSW.

Advanced manufacturing

NSW manufacturers produce almost one third of Australia’s total manufacturing output, generating around $33 billion in industry value, and employing almost one third of all jobs in the sector nationwide.

Supporting modernisation of NSW’s manufacturing industry to cleaner equipment, technology and processes will significantly reduce emissions while helping to retain existing and attract inbound manufacturing investment. 

The NSW Net Zero Industry and Innovation Program focuses on major opportunities to reduce emissions across NSW industry and business with $750 million of funding available to support clean technology innovation, new low carbon industry foundations and high emitting industries. 

Built environment

Buildings consume 40% of the world’s energy and emissions from building stock continues to rise, due to larger floor areas and increasing population. The building sector has significant potential to contribute to NSW’s net zero pathway.

The NSW Government’s recently announced Net Zero Buildings initiative commits more than $4.8 million of investment in speeding up the transformation of the state’s built environment towards net zero emissions.

It includes a world-leading framework to measure and certify embodied carbon for new buildings, developed in partnership with other governments and industry groups, and delivered as part of the NABERS (National Australian Built Environment Rating System) program. This program will boost transparency around building sustainability for investors, building owners and tenants and help to create consumer-led demand for low-carbon construction materials.

Agriculture, land, forestry and natural capital

The primary industry sector contributes more than $13 billion to the NSW economy every year and is the main driver of economic prosperity in Australia. Primary producers and landowners will play an important role in reaching net zero emissions in NSW through cost-effective mitigation as well as securing new income streams from carbon sequestration. The NSW Government has invested over $29 million in the Primary Industries Climate Change Research Strategy to help ensure the sector’s continued growth and resilience as the climate changes.  

The Primary Industries Productivity and Abatement Program provides significant funding to support farmers and land managers to:

  • optimise productivity
  • reduce emissions
  • access carbon markets
  • be rewarded for protecting biodiversity
  • seize new market opportunities.

This program will further future-proof NSW primary industries, build greater economic and climate resilience for regional NSW, attract private investment into sustainable agriculture in NSW, and support our state as we move to a low carbon future.

Clean technology and research institutions

NSW is home to clean technology business and research institutions that are leading the country in reducing energy consumption, producing clean energy and tackling environmental challenges. 

One such initiative is the Decarbonisation Innovation Hub, which the Office of the NSW Chief Scientist and Engineer (OCSE) is establishing under the NSW Net Zero Industry and Innovation Program.  

The creation of the Hub is in response to a Decarbonisation Innovation Study undertaken by the OCSE into the challenges and opportunities for meeting emissions targets and adapting to climate change, while generating economic development, prosperity and jobs growth in NSW.

The Hub will support researchers, industry and government stakeholders in critical sectors to collaborate, and increase the uptake of new technologies in decarbonising NSW. The Hub will coordinate work in 3 focus areas:

  • electrification and energy systems
  • land and primary industries
  • power fuels including hydrogen.