Australia-China Low Carbon and Innovation Cooperation Forum: Executive Summary 

Australia-China Low Carbon and Innovation Cooperation Forum: Executive Summary 

On 5 December 2022, the Australia-China Business Council (ACBC) and the Chinese Chamber of International Commerce (CCOIC) commemorated the 50th anniversary of diplomatic relations, with a bilateral business forum entitled Australia-China Low Carbon and Innovation and Cooperation Forum.

In a virtual format, similar to the inaugural forum jointly hosted by ACBC and CCOIC in December 2021, the forum brought together business and industry leaders to explore and highlight the benefits of cooperation between Australia and China in addressing the Climate Challenge.

As an extension of ACBC’s successful Green Channel program that has been supported by the National Foundation for Australia-China Relations, the forum featured keynote addresses at its introduction from Australia’s Ambassador to China, Mr Graham Fletcher, China’s Ambassador to Australia Mr Xiao Qian, Chairman of CCOIC Mr Ren Hongbin, Rio Tinto CEO Mr Jakob Stausholm, and ACBC’s Chairman & National President Mr David Olsson.

The program comprised two business panel sessions, one addressing the opportunities for collaboration across industries, the second deep diving into the initiatives currently underway within the steel industry.

Panellists include representatives from Rio Tinto, GHD, Clean Energy Financial Corporation (CEFC), Australian National University, Tsinghua University, China’s Green Partnership of Industrial Parks, China Iron and Steel Association, and China Minmetals.

The session was widely viewed, with over 500 attendees joining from China and Australia, including around 30 in person at an event hosted by ACBC Victoria. The Forum was made possible through the support of businesses committed to ACBC’s Green Channel program, including Rio Tinto (as platinum sponsor), China Construction Bank and ANZ.

Keynote takeaways

Forum speakers underlined the enormous opportunity for Australia and China to achieve progress on their net zero goals through collaboration, noting that at their recent meeting on the sidelines of G20, Prime Minister Albanese and President Xi identified climate change as a subject for further bilateral consultation and collaboration. Their meeting was followed in the same week by a meeting of Australian and Chinese climate ministers during COP27 in Egypt. These high-level meetings lay the groundwork for further discussions between the two countries on jointly addressing the climate challenge.

As both countries celebrated the 50th anniversary of diplomatic relations, Ambassador Xiao Qian affirmed that China was ready to deepen its friendship with Australia. Shared climate objectives and complementary advantages promised a bright future for Australia-China cooperation on the transition to net zero. He suggested the two countries should strengthen exchanges in areas such as green technology, green equipment, green services, and green infrastructure.

Ambassador Graham Fletcher described the low carbon economy as the “new frontier for Australian and Chinese businesses to cooperate and innovate.” China’s strengths in green technology and Australia’s renewable energy potential suggested scope for a successful partnership. He identified potential for collaboration in infrastructure, low-carbon industrial processes, and the commercialisation of new energy and green resources.

CCOIC Chair, Ren Hongbin, highlighted President Xi’s statement to the 20th Party Congress on the strategic importance for China in driving forward green development, while proceeding with reform and opening up. Addressing the climate challenge would be a key issue in China’s future development, and also bring new development opportunities to countries such as Australia.

Noting that the company had placed climate at the heart of its business strategy, Jakob Stausholm, CEO of Rio Tinto, highlighted the opportunity to significantly reduce global carbon emissions through decarbonisation of steelmaking.  He said, “if Australian iron ore became a zero carbon product and we worked in partnership across the industry to develop low carbon iron ore and steel-making technologies in China, this could potentially cut around 2 percent of global emissions.”

ACBC Chairman and National President David Olsson used the forum to propose a new work program between the two countries. He recommended that at the next senior-level ministerial meeting, both countries agree to establish a joint working group to develop a program of activity to strengthen policy dialogue and practical cooperation.

Business Panel: Opportunities for Australia China Cross-Sector Collaboration for Carbon Reduction

Senior Vice President of China Minmetals Corporation, Jerry Jiao, suggested the metal industry, particularly in China and Australia, had a responsibility to work together on decarbonisation.

He remarked that China Minmetals had made Australia its first choice for overseas resources development and was currently focused on reducing emissions of electricity and diesel. In its Dugald Zinc mine in Queensland, for example, it was reducing emissions by 33 percent through the use of solar power and was looking to reduce this a further 40 percent with wind power.

He proposed collaboration across the entire supply chain, recognising that companies were not just trading partners, but partners in solving common problems. He proposed collaboration on digital technologies to accelerate innovation. China Minmetals was applying digital technologies to smart mines and green factories.

For Australia to realise its 2030 emissions reduction goals, it would need to add 300 megawatts of renewable energy every month. Joe Harber, Head of Wind, Clean Energy Finance Corporation, noted collaborating with China would help Australia reach this goal. Taking wind as an example, there was scope for greater penetration of Chinese turbine suppliers in Australia.

Moreover, Australia could learn much about offshore wind from China, which was the world’s most advanced player accounting for 50 percent of global offshore wind output. Australia was interested in accessing Chinese technologies, such as technology that could detect eagles flying near turbines.

Sophie Lu, Director, Rhodium Group, suggested Australia and China could collaborate in base metal recycling and refining.  Australia was a leader in tailings management and could provide learnings to China. Australia could learn from China as the leader in battery-grade materials refining (nickel and cobalt).

Lithium was a further area of potential collaboration.  The closer geolocation and integration of raw materials and refining operations would create greater efficiency through ‘just-in-time’ supply chains and stronger predictive capabilities between supply and demand.

Mr Wu Meng, Vice Mayor of Beijing Daxing, gave an overview of the hydrogen development pilot area in Daxing, which aimed to provide sustainable hydrogen to power development in the Beijing area. The pilot area offered an enormous opportunity for collaboration with Australia.

Mme Yuyong Song, Director of the Green Partnership of Industrial Parks (GPIP), suggested GPIP could facilitate greater collaboration between Australia and China, by offering more effective match-making between the two sides based on the needs of companies in China’s industrial parks.  She encouraged Australian companies to visit China’s industrial parks and take part in technology fairs.

Chinese companies accounted for eight of the world’s top ten solar panel manufacturers. Sun Guangbin, Senior Vice President of JA Solar, encouraged Australian companies to visit China’s manufacturers to see the advanced, low-carbon manufacturing processes.

Panel Two: Carbon Reduction Collaboration and Joint Innovation in the Steel Industry

Panelists agreed that integration of renewables from sources such as wind and solar into traditional industries could support transition in the steel industry in win-win ways. Mr Huang Dao, Deputy Secretary of the China Iron and Steel Association, noted green steel manufacturing could only be achieved through strengthening collaboration between existing upstream and downstream industry chains. There was a need to reshape the whole value chain and provide incentives and penalties to reduce fossil fuel consumption.

Dr Jorritt Gosens, Research Fellow, Centre for Climate & Energy Policy, Crawford School of Public Policy, Australian National University, noted that in a decarbonised world, the location of future energy-intensive industries would be determined by access to cheap and abundant renewables.

Sources of renewable energy were in abundance in Australia’s Pilbara iron ore region. Australia could become an explorer of hydrogen-fuelled intermediate steel products (i.e., direct reduced iron) used in China’s blast furnaces.

With current technology, magnetite ores were better suited to green steelmaking than the hematite ore produced in Australia. The two countries could collaborate to develop green steelmaking technologies suited to Australian iron ore. The scope of the investment needed to produce the green energy and steelmaking infrastructure to make China’s steel green was immense. It also required high-level policy coordination across the supply chain between Australia and China.

Professor Li Zhen, President of the Institute of Climate Change and Sustainable Development, Tsinghua University, emphasised involving young people in cooperation to address the climate challenge. He proposed: promoting intergenerational equality; expanding access of younger people to participate in global climate governance, so more can contribute to global climate change responses; training young people to become global leaders by providing a platform for opportunities for the participation of youth.

Tian Yongzhong, Vice President of the Aluminum Corporation of China, noted non-ferrous was also an important area of focus. He identified opportunities for collaboration in the recycling of non-ferrous metals to reduce energy consumption and carbon emission during the mining and initial smelting stages.

Panellists underlined the importance of involving the research sector in collaboration toward net zero. Mr Mao Xiaoming, Vice President, Central Research Institute; Executive Deputy Director, Low Carbon Metallurgy China Baowu, noted his company had worked with five leading Australian universities on joint research, providing $3 million in funding annually. He referred to the launch of the Global Low-Carbon Metallurgical Innovation Alliance in 2021, which attracted participation by three Australian companies including Rio Tinto alongside companies from 15 countries. Member companies have advocated low-carbon raw material preparation, signed climate change collaboration agreements, and were working for greater low-carbon metallurgical innovation.  This was an example of Australia and China working together globally.

For further information about ACBC’s Green Channel initiatives, including the opportunity to be involved with ACBC working groups in branches around Australia, please contact us at national@acbc.com.au. Further information, as well as our report, The Climate Challenge: opportunities from the collaboration between Australia and China, can be found on our website