Publication
Generative AI: A global guide to key IP considerations
Artificial intelligence (AI) raises many intellectual property (IP) issues.
Australia | Publication | May 2023
The joint announcement of the Climate, Critical Minerals and Clean Energy Transformation Compact by the US and Australian Governments reflects the key role each country plays in critical minerals1 and the energy transition.
The Compact represents a huge step forward for US – Australian preferential trade and investment. The implementation of the Compact is likely to increase investment opportunities in both the US and Australia; to smooth supply chains for companies operating across the two countries; and be a welcome development for Australian critical minerals companies and renewables developers who are looking for capital and off-takers to translate their ambitious Australian projects into reality.
Over the coming months we will be publishing a series of articles that examine the opportunities presented by the Climate, Critical Minerals and Clean Energy Transformation Compact.
As demand for critical minerals and renewable technology continues to rise, the US is expanding its proactive measures to secure supply, hold out competitors and maintain leadership on the energy transition. In doing so, the US has continued to look to its allies such as Australia as close partner in trade and in the Indo-Pacific region. US capital is the leading source of foreign investment in Australia.
Australia was already a beneficiary of US policy when it passed the Inflation Reduction Act. There are clear advantages to the US of increased trade and cooperation on the energy transition:
Nonetheless, the latest announcement of the Climate, Critical Minerals and Clean Energy Transformation Compact (Compact), following last week’s meeting in Japan between President Biden and Prime Minister Albanese, represents yet another huge step forward in leveraging the mutual benefits that will flow from working more closely together. It:
If the potential of the Compact is realised, it should make it easier than ever for Australian and US companies to invest and do business between the two countries, likely leading to:
Most significantly of all (in a detail that deserves emphasis) it will involve President Biden asking Congress to have Australia join Canada in being declared a “domestic source” under Title III of the Defence Production Act (DPA). The DPA is a US federal law originally enacted to assist in mobilisation efforts with respect to the Korean War, and it has been President Biden’s key tool in increasing the speed and scope of clean energy technology manufacturing in the US through incentives for “domestic sources”.
This development could create an unprecedented opportunity for Australian resources companies to secure US investment in mining projects, for the development of more Australian based refineries, and for advanced manufacturing in Australia (largely absent from Australia since the closure of the car manufacturing industry).
Australia and the US have also committed to supporting Pacific-led initiatives to enhance climate change mitigation, adaptation, and resilience efforts. This will include working with Multilateral Development Banks to implement the COP27 decision to establish new climate finance funding arrangements to accelerate climate adaptation, and address loss and damage associated with adverse impacts of climate change in the Pacific Islands. This is likely to go hand-in hand with Australia’s bid to host COP31.
This latest announcement is further evidence that climate change and the energy transition has moved to the front and centre of the Australia – US relationship, which will be welcome news for many domestically, and in the region. It will be a particularly welcome development for those in the Australian resources, manufacturing and renewables industries. As the Compact is implemented, we expect to see a significant boost to Australian developers of Australian renewable and critical minerals assets, with more investment sources and greater pathways to high value global trade.
It will be important for industry to engage with the Taskforce to help shape the implementation of the Compact. Opportunities lie in the translation of the Compact to tangible measures. We will be tracking this closely and will continue to share updates and insights.
Critical minerals are metallic or non-metallic elements (such as copper, lithium, nickel, cobalt and rare earths) that are essential for modern technologies, economies or national security, and have a supply chain at risk of disruption. They are essential components for technological enablers of the energy transition, including electric vehicles and solar panels.
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