Case study: Redflow charging forward on clean energy storage solutions Australian stationary energy storage company Redflow aims to lead the clean energy transition by delivering the world's safest and cleanest energy storage solution.
Its ZBM3 battery is the world's smallest commercially available zinc–bromine flow battery and, due to its unique form factor, can be deployed for a range of applications, including commercial, industrial, telecommunications and grid-scale storage.
In 2018, Redflow set up manufacturing operations in Chonburi, one of Thailand's free trade regions and a major automotive and electronics manufacturing and logistics hub.
Redflow's Chief Executive Officer, Tim Harris, said the company moved manufacturing to Thailand because of its advanced manufacturing capability, including a skilled and internationally competitive labour force, and supply chain connections via a deep seaport with shipping routes to its target markets.
Looking to the future, Mr Harris said, 'Redflow will continue investing to further develop our manufacturing in Thailand. The strong local supply base is a fantastic resource and our Thai national general manager demonstrates the ongoing and long-term commitment we have to manufacturing in the region, while also adding significant value to the ongoing operational success of the facility.'
'We also appreciate the backing we've had from the Australian Government. The support from the Australian embassy and Austrade in Thailand has really helped us navigate the challenges in establishing our manufacturing presence, including providing market insights to our Australian executive team and boosting our profile by nominating Redflow for a Thai Government APEC Bio-Circular-Green Award and a visit from the Australian Ambassador to our factory.'
Workers at Redflow's battery manufacturing plant in Chonburi, Thailand. Source: Redflow
Regional consultations highlighted the substantial interest in Australia's expertise and capabilities in emerging low-emissions technologies. For example, clean hydrogen and derivative fuels are being considered for a range of different uses in Southeast Asia. Singapore will be an important market, with uses across maritime, fuel bunkering, electricity, transport and industrial sectors. Vietnam, Malaysia, Brunei, Thailand, Laos, the Philippines and Indonesia are exploring hydrogen's potential in electricity and industrial sectors. Australian technical assistance is already helping build hydrogen expertise and may open future commercial opportunities, including clean hydrogen exports, two-way investment, and partnerships to accelerate commercialisation of new technology.
High-integrity carbon markets and regional trading in carbon offsets could accelerate investment in emissions reduction. Southeast Asia's nature-based solutions, including blue carbon, have technical abatement potential of around 5.2 gigatonnes of carbon dioxide equivalent abatement in 2030.110 Carbon trading is already taking place in Singapore and Thailand, and will begin in Indonesia in 2023.111 Vietnam, Malaysia and the Philippines are also planning carbon markets in the next five years.
Government collaboration with industry will remain critical to achieving the region's decarbonisation needs. This includes bilateral partnerships like the A$200 million Australia–Indonesia Climate and Infrastructure Partnership and the Singapore–Australia Green Economy Agreement, developing regional rules and standards through the Indo-Pacific Economic Framework (IPEF), and capacity-building work in APEC to support sustainable economic growth. Export Finance Australia has invested US$62 million in clean energy projects and is working on a US$200 million facility to support Indonesia's energy transition. Australia's development financing instruments have invested A$67.2 million in climate projects in the region, mobilising A$177.5 million in private investment and providing 127,291 people in Southeast Asia access to clean energy.
Pathways to 2040 In addition to the cross-cutting recommendations outlined in Chapter 2, which will have a broad economic impact, this chapter has additional specific recommendations on the green energy transition.
Remove blockages
Consultations for this strategy highlighted key barriers for Australian businesses and investors, including construction risks (such as lengthy approvals and land acquisition), as well as policy and regulatory uncertainty. Other barriers include a lack of consistent data on environmental, social and governance and climate risk, investors' limited knowledge of regional energy markets, and a mismatch between the small deal sizes and costs of due diligence.
Countries in the region are developing new sustainable finance requirements and climate disclosure rules. Ensuring interoperability with Australia's emerging standards will ensure investors and businesses on both sides do not face new barriers.
Recommendation
Australia's Treasury should lead expanded work with Southeast Asian partners on high-quality and interoperable sustainable finance classifications and climate-related disclosure rules.
Carbon trading represents an important economic opportunity for Australia and the region. Already more than 5,000 companies globally have committed to setting voluntary targets, including over 500 Australian brands under Climate Active, which could source carbon offsets from Southeast Asia.112 Regional trading in carbon offsets, for both compliance and voluntary markets, will need to be underpinned by harmonised and robust standards of carbon accounting and carbon market governance. The Australian Government could work with international partners and countries in the region to build the infrastructure and technical capability, including monitoring, reporting and verification standards. This would also generate opportunities for Australian companies to provide a range of carbon services, project development and project finance to support market development.
Recommendation
Explore establishing standards and regulations to allow for a regional market in low-energy goods, including electricity and carbon, with interested Southeast Asian partners.
Build capability
Australian and Southeast Asian companies will have major opportunities to partner in solar, battery storage and electric vehicle supply chains. Malaysia and Vietnam have the largest solar manufacturing capacity outside of China. With Australia's demand for solar expected to triple by 2040, partnerships with Southeast Asia could help to commercialise Australia's leading solar research and development, secure Australian supplies of solar panels and boost Australian silica exports.113
In battery storage, Malaysia, Thailand, Indonesia, the Philippines and Vietnam are emerging as regional players in the value chain, with existing manufacturing, growing electric vehicle industries, and policy incentives. There will be opportunities for Australian companies to move up the battery value chain and supply high-value battery material exports.
IPEF is laying the foundation for Australia, Southeast Asian countries and other partners to collectively develop resilient and diverse clean energy supply chains. With Australia as chair, Quad leaders also committed in May 2023 to encourage greater public and private investment and collaboration in clean energy supply chains, research, development and demonstration, and innovation in the Indo-Pacific. The Australian Government should seek opportunities through these platforms to form partnerships with Southeast Asian counterparts to support clean energy supply chains.
Recommendation
Draw upon regional clean energy supply chain initiatives to support strategic projects involving Australian and Southeast Asian partners in the battery, electric vehicle and solar sectors.
Consultations in Southeast Asia showed high levels of interest in Australian technical assistance, which could help to create a market for future commercial opportunities. Submissions to the strategy recommended that assistance focus on continued development of detailed decarbonisation pathways, international best practice regulation, and technology transfer. Australia's CSIRO is already working with the region, including on power system transformation and electrification, but there is more CSIRO could do in partnership with regional counterparts, industry, policy agencies and the research sector to advance the clean energy transition.
Recommendation
Develop a clean energy science and technology engagement strategy to work with regional counterparts on technical challenges to meet net zero.
Regional consultations highlighted the significant future green economy workforce needs. Southeast Asia will require an additional 5.5 million trained workers in the renewables sector alone by 2050, as well as workers across grid infrastructure, clean energy supply chains, energy efficiency and low-emissions technologies.114
Australia will have its own workforce needs. There is an opportunity to build and share a regional green workforce through future-focused investment in workforce training and dedicated labour mobility programs for green skilled workers. Such a program would see skilled workers from the region undertake training and work in Australia before returning to their home country. This would benefit all sides, delivering the labour force for clean energy transition across the region. Collaboration between industry and education and training providers to develop green qualifications will be key. There is a potential role for the Australian Government to help facilitate this.
Recommendation
Support industry and education and training providers to develop and promote green qualifications for the Southeast Asian market.
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