The NSW Government has opened two grant programs worth a combined $80 million as part of its Industrial Decarbonisation Initiative, aimed at reducing emissions across mining and manufacturing.
The funding is split evenly between two programs with distinct aims. The $40 million Renewable Gas Production Program is focused on increasing the supply of biomethane, while the $40 million Low Emissions Industry Program supports on-site upgrades at existing facilities.
Both programs are now accepting applications.
Renewable gas program focuses on biomethane supply
The Renewable Gas Production Program will co-fund up to 50 per cent of project costs to develop commercially ready biomethane facilities.
Biomethane is produced from organic waste, including food and agricultural by-products, and can be used as a direct substitute for natural gas without requiring changes to existing infrastructure.
Eligible projects must deliver at least 0.1 petajoules of biomethane into the network each year by June 2030. The program is intended to contribute enough renewable gas to replace close to 4 per cent of current industrial natural gas use.
The NSW Government states the program will boost the production of biomethane gas, supporting the shift to renewable energy by providing a cleaner fuel supply for the state.
On-site upgrades supported through low emissions program
The Low Emissions Industry Program is designed for manufacturing and mining facilities reporting under the National Greenhouse and Energy Reporting (NGER) Scheme and emitting less than 100,000 tonnes of CO2 per year.
Grants ranging from $500,000 to $10 million are available, covering up to half of project costs.
Projects must reduce emissions by at least 1,000 tonnes of CO2 annually and be fully operational by June 2030.
Eligible activities include fuel switching, heat pump installation, electrification, waste heat recovery, and upgrades to existing plant and processes. The program prioritises improvements within existing facilities rather than new builds.
Facilities covered by the Safeguard Mechanism are not eligible to apply.
Program design aims to simplify access to funding
The Industrial Decarbonisation Initiative brings multiple funding streams under one framework, with the aim of making it easier for businesses to access support and deliver emissions reduction projects.
According to the NSW Government, the Industrial Decarbonisation Initiative streamlines the NSW Government’s industrial emissions reduction grants to make it easier for businesses to apply for grants and deliver projects.
The initiative forms part of the state’s broader emissions targets, which include a 70 per cent reduction by 2035 and net zero emissions by 2050.
Application process and timing
Applications for both programs are open, with the Low Emissions Industry Program closing on 9 June 2026 at 11:00pm (AEST).
An online Q&A session is scheduled for 31 March 2026 to provide further guidance for applicants.
