The Australian Renewable Energy Agency (ARENA) has been appointed to lead the federal government’s AU$1.1 billion Cleaner Fuels Program, a scheme designed to kickstart a domestic low-carbon liquid fuel (LCLF) industry.
First announced in September 2025, the program is a key part of accelerating LCLF production in Australia, helping to boost national fuel security while tackling emissions in hard-to-abate sectors, most notably aviation and heavy transport, where electrification remains a significant challenge.
Under the new mandate, ARENA will oversee production-linked incentives distributed over the next 10 years.
The funding is specifically targeted at advanced projects nearing commercial readiness, ensuring Australia moves quickly from the drawing board to production.
ARENA CEO Darren Miller said the initiative is vital for shielding Australia from global supply chain volatility.
“Australia is well-positioned to become a key producer of low-carbon liquid fuels, backed by our renewable resources and innovation capability,” Miller said.
“Through this program, ARENA will support advanced projects that could lead to fuel production, helping to lower emissions and build Australia’s resilience to fuel shocks.”
The appointment follows extensive consultation between ARENA and the Department of Infrastructure and Transport.
The AU$1.1 billion package joins a growing suite of green energy initiatives managed by the agency, including AU$250 million via the Future Made in Australia Innovation Fund’s LCLF stream and AU$33.5 million already committed to five projects under the Sustainable Aviation Fuels (SAF) Funding Initiative.
By centralising these funds under ARENA, the government hopes to streamline the path for local refineries and bio-fuel start-ups to scale up.