Here is a report posted on the ABC News website earlier this morning. Although they quote AVL this article applies to every vanadium explorer/producer in Australia.
****************************** Vanadium a key part of Future Made in Australia policy — if Senate can be convinced to back it
Queensland and Western Australia have deposits of vanadium. (Supplied: AVL)
abc.net.au/news/critical-mineral-vanadium-about-to-get-major-government-subsidy/103910090
In short: Vanadium producers have welcomed the federal government's $7 billion in tax incentives for critical minerals.
The subsidies aim to build the sector in line with the US and other allies to prevent China from controlling supply of materials needed in the transition to renewable energy.
What's next: The tax incentive could be thwarted if Labor can't muster enough votes in the Senate to pass it.
The federal government is planning to pour billions of dollars into critical minerals in an effort to build up local production of batteries, solar panels and wind turbines.
It's the biggest spend in the Future Made in Australia policy, which has the twin aims of supporting technology that helps the transition to net zero emissions and developing supply chains that don't rely on China.
Producers of the critical mineral vanadium, which is used in long-duration batteries, are counting on the financial support to scale up their production.
But with the Coalition rejecting the idea and the Greens reserving their support, it's not clear whether Labor's plan will come to fruition.
The tanks containing electrolyte for the flow battery.(Supplied: DICP) Haven't heard of vanadium? You will soon
Companies planning to mine and process vanadium stand to be big beneficiaries of the critical minerals subsidy.
Vanadium is a rare metal used in vanadium flow batteries, a large-scale alternative to lithium-ion batteries.
They were invented in Australia in the 1980s but haven't been used widely because of their size and scale.
But the rapid expansion of renewable energy has created a new market for megawatt-scale batteries for electricity grids.
Australian Vanadium Limited plans to mine vanadium and manufacture vanadium electrolyte in Western Australia, as well as make and assemble vanadium batteries for use domestically and internationally.
Vanadium batteries are "a 40-year-old technology that is coming into its own," according to Australia Vanadium Ltd CEO Graham Arvidson.
"In Australia, we have lots of vanadium so it's a good opportunity for the government to align (it) into a solution for the energy transition."
"Where they are highly commercial are for these 8, 10, 12 hours or longer batteries, where existing technologies like lithium-ion start to lose competitiveness."
For Australian Vanadium Ltd, the federal government's announcement in the budget of tax incentives for critical minerals production
A schematic for a vanadium redox flow battery.(Supplied: Royal Society of Chemistry)
"In order to do that in Australia on a competitive basis, we just wouldn't get there without some help like this," Mr Arvidson said.
"So for us to not just get finance, but remain competitive once we get into production, it's a really important bit of wind in our sails."
Queensland-based battery maker Vecco wants to have large-scale vanadium mining and electrolyte manufacturing up and running by 2026.
Its managing director Tom Northcott welcomed the budget announcement, too.
"The (tax) incentive would send a strong signal to the market, highlighting the government's support for the critical minerals sector and likely attracting further investment and partnerships with our trading partners," he said. What are vanadium redox flow batteries?
A type of battery invented by an Australian professor in the 1980s is being touted as the next big technology for grid energy storage. Read more The $7 billion on the table for critical minerals
The sector had been lobbying for a production tax credit, to match what the United States offers critical minerals producers — and the federal government agreed.
From 2027, the government will offer to cover 10 per cent of the costs of refining and producing 31 critical minerals, including vanadium.
It will cost $7 billion over 10 years and is the most expensive part of the federal government's Future Made in Australia policy.
Resources Minister Madeleine King told the ABC the $7 billion in subsidies was necessary to meet the policy's objectives.
"We really need it to get to net zero (emissions), because it's these critical minerals and rare earths that will be needed for all that technology that we are relying on for battery storage, for electric vehicles, for wind turbines, even for the glass in solar arrays," she said.
"This nascent industry is on the cusp of getting going, but because of international markets and things outside of our country's control, pricing is manipulated around the world."
"So the government has to step up and help out, and make sure these projects get off the ground." Support needed in the Senate for subsidies to start
But first the subsidies need to pass parliament, which is looking uncertain.
Opposition Leader Peter Dutton has derided the subsidies for both critical minerals and green hydrogen as "billions for billionaires."
"Those projects should be able to stand alone. We support them, but not with taxpayers' money, splashing billions of dollars," he said shortly after the government announced its plan.
The Greens are not yet willing to back it either, with leader Adam Bandt only saying his party would "have a look at the legislation."
It leaves critical minerals producer hoping a deal can be struck in the Senate to secure the subsidies.
"Without a mechanism such as the production tax credit, Australia may lose its ability to compete in attracting the capital necessary to grow our domestic critical minerals industries and battery material manufacturing base," Vecco's Tom Northcott said.
Australian Vanadium Ltd's Graham Arvidson said the tax credits would be a low-risk way of supporting the sector.
"Taxpayers don't pay a cent until we actually succeed and I think … it's a very efficient way to do it."
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