NSW unveils $80 million boost for industrial decarbonisation efforts amid transition to net zero

The New South Wales government has opened two $40 million grant streams intended to help mining and manufacturing firms cut greenhouse gas emissions and hasten the shift away from fossil fuels as the state pursues net zero by 2050. According to the report by Sustainability Matters, the funding is being delivered under a new Industrial Decarbonisation Initiative that consolidates industrial emissions grants to simplify access for businesses.

The Renewable Gas Production Program sets aside $40 million to scale commercially mature biomethane projects, offering co‑funding of up to 50% of development costs. Eligible proposals must deliver at least 0.1 petajoules of biomethane into the gas network each year by 30 June 2030, with the program target described as producing sufficient renewable gas to displace almost 4% of the state’s industrial natural gas demand. The initiative aims both to divert organic waste from landfill and to create a lower‑carbon gaseous fuel for hard‑to‑electrify processes.

The companion $40 million Low Emissions Industry Program is targeted at manufacturing and mining sites that report under the National Greenhouse and Energy Reporting Scheme and emit less than 100,000 tonnes of CO2‑e annually. It is designed to co‑fund practical, site‑level interventions such as fuel switching, heat pump installations to replace combustion heating, and facility retrofits and process optimisation to reduce energy intensity without requiring new plant construction.

“Decarbonising industry is critical to reaching net zero while protecting the health of our communities and environment,” said Executive Director of Business and Industry Decarbonisation Jenny Merkley. “As a streamlined gateway to NSW Government funding, the Industrial Decarbonisation Initiative plays a key role in the broader energy transition, backing solutions that can be delivered now rather than years down the track. Under the new Low Emissions Industry Program, manufacturers and mining operators have real opportunities to lower energy costs, strengthen performance and implement proven solutions that reduce carbon pollution. [Meanwhile], the Renewable Gas Production Program will help scale biomethane production which is a practical and affordable solution to put our state’s waste to work, capturing gas that would otherwise enter the atmosphere, and converting it into a cleaner fuel supply.”

The $80 million package sits alongside a suite of larger NSW programs aimed at deeper industrial transformation. The High Emitting Industries grant programme currently offers up to $305 million to support major manufacturing and mining facilities in developing projects from feasibility through to commissioning, explicitly to drive sustained emissions reductions by 2030. Separately, the Net Zero Manufacturing Initiative has committed $275 million to accelerate the local production of low‑carbon goods and clean‑tech manufacturing capacity, while a $26.2 million Clean Technology Innovation grants round is supporting early‑stage pilots and commercialisation of novel emissions‑reducing technologies such as ship hull cleaning robots and lower‑impact lithium extraction.

Government guidance for industry also flags Transformative Industry Projects scoping grants to identify opportunities such as green hydrogen and carbon capture for high‑emitting sites, targeting facilities that reported Scope 1 emissions above 85,000 tCO2‑e in 2019/20.

For industrial operators, the NSW grants create a spectrum of entry points: the newly launched $40 million funds for smaller emitters and biomethane developers; larger, multi‑hundred‑million programmes for transformative projects; and innovation grants to prove next‑generation technologies. Industry data and recent funding rounds indicate policymakers are attempting to balance near‑term emissions wins with longer‑lead, system‑level investments across fuels, electrification and process change.

Applications for the two $40 million programs are open through the NSW Climate and Energy Action portal, with guidance documents and eligibility criteria published by the energy department. The funding emphasises co‑investment and commercially mature proposals for renewable gas, and practical onsite decarbonisation measures for manufacturers and miners, signalling a pragmatic, staged approach to industrial emissions reduction in NSW.