Millions in federal funds will be kicked into running a feasibility study for a desalination plant in South Australia to support emerging net-zero industries.
Fresh off its Future Made in Australia plans in the budget, including tax breaks for producing critical minerals and hydrogen, the Albanese government will funnel $65 million into deciding if the Northern Water desalination project is worth pursuing or not.
If it goes ahead, a 260 megalitre-a-day desalination plant on the Eyre Peninsula will be built, and a 600km pipeline to transport the water to the far north of the state.
The water is needed to process and refine critical minerals and generate clean hydrogen that is needed for the green metals industry in the Upper Spencer Gulf.
Without secure supplies of the huge amounts of water needed for hydrogen production, it is not possible to get these net zero industries off the ground, the government says.
The South Australian government and resources and energy companies will also help cover the cost of the total $230 million package of work.
Treasurer Jim Chalmers and Minister for Environment and Water Tanya Plibersek said the Future Made in Australia industry policy was about "unlocking and incentivising investment in the jobs and opportunities of the future".
They said it could create 4200 jobs in key net zero industries and underpin a $150 billion boost to the South Australian economy over its lifetime.
