About the Smart Energy Council

The Smart Energy Council (SEC) is the peak independent body for the renewable energy and storage industry in Australia. Representing over 700 member companies, the SEC’s membership includes technology manufacturers, installers, retailers, financiers, and policy advocates. The organisation is dedicated to accelerating the transition to clean, affordable energy through sectors including solar, battery storage, energy management, and renewable hydrogen and ammonia.

Introduction

The SEC welcomes the opportunity to provide evidence to the Senate Select Committee on Australia’s Productivity. This submission focuses on strategic productivity growth driven by commercial building electrification, transport decarbonisation, sustainable aviation fuel (SAF), waste-to-energy, and product stewardship. The council broadly supports the findings of the Productivity Commission’s interim report, Investing in cheaper, cleaner energy and the net zero transformation, and advocates for policy measures that encourage private investment in environmental sustainability.

Electrification of commercial buildings

The electrification of commercial and industrial buildings is identified as a major untapped opportunity for reducing operating costs and improving energy efficiency. Research from the SEC’s ‘Missing Middle’ report suggests that while electrification technologies are commercially available and cost-effective, deployment is hampered by upfront capital costs and split incentives between landlords and tenants. The SEC recommends the development of a National Commercial Building Electrification Roadmap to align electrification with distributed energy resources (DER) and demand flexibility. Additional recommendations include introducing targeted investment incentives such as accelerated depreciation and concessional finance, and enabling commercial buildings to participate fully in virtual power plant and energy flexibility markets.

Transport productivity: heavy vehicles, light vehicles and road user charging

Transport remains a productivity-constrained sector due to high fuel costs and diesel dependence. Diesel use accounts for 17% of Australia’s emissions. The current Fuel Tax Credit (FTC) scheme is identified as a structural barrier, returning off-road users 51.6 cents per litre, or $191 per tonne of CO2, which significantly exceeds the current Australian Carbon Credit Unit (ACCU) price of approximately $37. The SEC advocates for a cap-and-reinvest model for the FTC to mobilise capital for clean investment.

To support freight electrification, the SEC recommends purchase incentives, accelerated depreciation, and streamlined grid connection processes for charging infrastructure. For light vehicles, the council cautions against removing existing incentives without replacement measures and calls for nationally harmonised EV charging standards. The submission also suggests hypothecating future road-user-charge revenue into transport electrification initiatives.

Sustainable aviation fuel (SAF) and renewable diesel

The SEC identifies low-carbon liquid fuels as vital interim measures for hard-to-abate sectors. It recommends prioritising SAF for aviation where electrification is not currently feasible and directing renewable diesel toward mining, agriculture, and heavy industry. A SAF and renewable fuels investment framework should be established, incorporating capital support for biorefineries, feedstock certification standards, and long-term offtake agreements with operators.

Waste-to-energy and industrial transformation

Waste-to-Energy (WtE) must be positioned strictly as a residual waste treatment solution within a circular economy framework to avoid undermining recycling and reuse outcomes. The SEC recommends adopting nationally consistent definitions for WtE and requiring independent lifecycle emissions assessments and continuous monitoring. Policy settings should prevent feedstock lock-in arrangements that reduce flexibility, and transparent economic modelling should be mandated to demonstrate genuine productivity gains compared to alternatives like advanced recycling or landfill-gas capture.

Product stewardship: solar panels, batteries and EVs

The council highlights a significant resource recovery opportunity from end-of-life clean energy assets. In 2025, an estimated 3.4 million solar panels were decommissioned, and the value of recovered materials such as silver, copper, and silicon is expected to exceed $7.3 billion by 2043. Currently, the market is fragmented, with high logistics costs and inconsistent state-based regulations. The SEC recommends establishing a national product stewardship scheme for solar panels and stationary batteries with mandatory recycling and material recovery targets. For electric vehicles, a national battery stewardship scheme and standards for second-life applications are recommended to manage increasing volumes of end-of-life components.

Regulatory reform and approvals efficiency

The SEC supports the Environment Protection Reform Act 2025 and the establishment of Environment Protection Australia (EPA) and Environment Information Australia (EIA). New National Environmental Standards are due to commence by 1 December 2026. To unlock productivity gains, the SEC recommends adequately resourcing these bodies to prevent bottlenecks, establishing specialist strike teams with regional ecological expertise, and explicitly considering the energy transition and critical minerals supply chains in approval decisions.

Productivity in the environment sector and related industries: agriculture, forestry, fishing and mining

Strategic co-location of renewable energy with agriculture, such as agrivoltaics and grazing under solar arrays, allows farmers to diversify income. The SEC calls for national guidance on dual land-use design standards and harmonised approval pathways. In the mining sector, decision times for resources projects have increased by 60 per cent, from 2.3 years in 2019 to 3.8 years in 2025. A 12-month delay across the mining project pipeline could cost the Australian economy $51 billion in cumulative GDP. Specific examples include the Greenbushes lithium expansion, where overlapping assessments added a 24-month approval extension and roughly $85 million in costs. The SEC recommends prioritised, parallel assessment pathways for critical minerals and clean energy infrastructure.

Conclusion

The SEC concludes that Australia’s productivity challenge is inseparable from its energy transition. By placing electrification, renewable energy deployment, and circular economy initiatives at the centre of long-term strategy, Australia can reduce costs, improve competitiveness, and accelerate progress toward net zero emissions.