We recently submitted our recommendations to the Australian Government's Securing Australia's Cleaner Fuels Industry consultation, outlining a market-led approach to building Australia's low-carbon liquid fuels industry.
Our central message is simple: government doesn't need to buy this industry into existence. It needs to make demand certain.
Read our full submission below.
Turning Australian Feedstock into Australian Fuel
Australia already produces significant volumes of feedstock suitable for renewable fuel production, including tallow and used cooking oil. However, much of this material has historically been exported for processing overseas.
In 2017, the United States accounted for just 5% of Australia's tallow exports. By 2022, that figure had risen to 50%, demonstrating how international policy incentives can redirect Australian feedstock offshore.
With changes to the US 45Z Clean Fuel Production Credit, we believe Australia has a window of opportunity to establish domestic processing capacity and retain more of the economic benefits of its own feedstock.
Our Key Recommendations
Our submission outlines four priorities:
1. Establish government as an anchor customer. Commit approximately 20% of suitable government fuel demand to low-carbon liquid fuels by 2030, providing producers with reliable offtake arrangements.
2. Use targeted tax incentives. Introduce a three-year, progressively reducing biodiesel excise concession to encourage early market development without creating permanent subsidy dependence.
3. Prioritise domestic production. Allow imports to support initial market development while creating a clear pathway towards Australian refining and processing capacity.
4. Legislate long-term demand obligations. Introduce a volumetric renewable fuels mandate from 2029, transitioning towards carbon-intensity benchmarks from 2035 to provide investors with certainty.
Building Australia's Renewable Fuels Future
We see biodiesel and renewable diesel as practical starting points, with sustainable aviation fuel representing an important next phase.
Australia already has the feedstock, agricultural supply chains and potential customers across transport, mining, aviation and defence. What is needed now is a policy framework that encourages private investment and supports domestic production.
Our position is clear: Australia should become a producer, not simply a consumer, of the low-carbon fuels its economy will increasingly require.
Our Senior Advisor, Bryan Duncan, will attend the Bioenergy Australia Queensland Summit on 14 October, where regional bioenergy development and fuel security will be among the key discussion topics.
Read Our Full Submission
About GSX Commodities
GSX Commodities is a commodities-focused advisory and solutions business supporting clients across global commodity markets. The firm provides market insight and analysis alongside advisory and risk management support, helping clients navigate volatility and make informed decisions.
Henry Walsh
Managing Director, GSX Commodities
