New $300 Million Scheme to Offer Farmers Discounted Loans to Cut Emissions

A young girl on her family farm outside Coonabarabran, NSW, Australia, after the break of a years-long drought on Oct. 1, 2020. Brook Mitchell/Getty Images

Farmers, agri-businesses, and equipment buyers can now access discounted loans under a $300 million initiative by the Clean Energy Finance Corporation (CEFC), supported by the Labor Albanese government.

The CEFC will offer interest rate discounts of up to 1.15 percent through National Australia Bank’s green asset finance program, aimed at supporting Australia’s transition to net-zero emissions.

The initiative is designed to encourage investment in technologies and practices that reduce carbon footprints while supporting economic growth across key industries.

The program includes two components.

The NAB Green Finance for Vehicles and Equipment Program provides $200 million to support investment in manufacturing, transport, and recycling, offering a 0.5 percent discount on interest.

Loans, ranging from $10,000 to $5 million, will cover renewable energy components, net-zero emissions vehicles, and recycling operations.

The second program, with a budgeted $100 million, offers a 1.15 percent discount for farmers buying technologies like enhanced fertilisers and methane inhibitors.

Farmers will be able to access loans between $1 million and $5 million, saving up to $57,000 annually, which can be reinvested to improve farm practices.

“We want Australian farmers, businesses, and manufacturers to be as competitive as possible in global markets and be supported to get there as cheaply and efficiently as possible,” said Minister for Climate Change and Energy Chris Bowen.

NFF President on Net Zero Emissions for Farmers

Despite the government’s push, National Farmers’ Federation (NFF) President David Jochinke has expressed concern that Australian agriculture cannot achieve net zero emissions by 2050.

Citing the Climate Change Authority Sector Pathways (CCASP) report, Jochinke earlier highlighted technological barriers to decarbonisation, including slow innovation adoption and high costs.

He explained that, while farmers are eager to adopt sustainable practices, the current technologies available are not cost-effective or widespread enough.

Furthermore, technological advancements take years, and farmers would struggle to shoulder the burden of waiting.

“Farmers are already doing the hard yards in these areas, but there’s still a lot of work to do to make sure these innovations are affordable and effective,” he added.

NFF’s Key Election Demands

Meanwhile, as the federal election approaches, on Jan. 15, the NFF outlined its election priorities, calling on the government to reconsider the “super tax,” preserve the diesel fuel rebate, and abolish the Biosecurity Protection Levy.

It also seeks $1 billion in government support for freight infrastructure, regional telecommunications improvements, and investment in mental health initiatives for rural communities.

Other demands include a farm visa to address worker shortages, expanded agricultural training, and reforms to the Murray-Darling Basin.