a focus for all agencies and in particular to enable strong and growing public support for this new future. The WA Government Inquiry into Micro Grids is already starting such a process. A Parliamentary Review can assist to gain perspective on this transition and especially to see how the value-added industries are developing. The review would be updated every five years as the transition unfolds. Another key aspect of a Parliamentary Inquiry could be about how Lithium Valley relates to energy costs. Australia’s access to energy resources of both fossil fuels and renewables is world- leading. WA is now showing leadership in the adoption of solar energy and batteries. One of the reasons for this happening is how solar energy companies in Perth have been able to commercialise roof top PV through permitting and financing that is considerably cheaper than in the US. Taking advantage of the New Energy minerals and the solar resources, energy pricing provides opportunities for reliable long-term supply that becomes a major point of difference to competitor nations and provides Australia with significant competitive advantages. The ability to offer long term, reasonably priced energy is essential for manufacturing as it allows companies to continually incrementally improve production. Australia needs to be at the forefront of how New Energy usage, pricing and delivery can stimulate energy-intensive industry growth and value- added energy services. This can be supported and sustained by the ongoing development of locally sourced and cost competitive new generation electricity generation. These matters need to be constantly reviewed. 3.3.4. Domestic reservation across New Energy metals Following gas policy, set aside key strategic minerals for domestic use. It is recommended that a domestic reservation scheme be established, based on market valuations, to ensure security of supply for local production and businesses. Security over supply is a major driver of this industry and a domestic reservation policy would encourage local value- added industry. WA introduced a domestic gas reservation policy in 2006, which requires new gas developments to supply the equivalent of 15% of their gas exports to the Western Australian domestic gas market. The aim of the policy is to maintain domestic gas prices below export parity. Lithium, rare earths and other resources could be subject to similar domestic reservation policies in order to develop and support local business. Although a portion of the income from the resource is foregone the additional value adding from local processing increases the gross return on the original resource. Allowing the export of finite strategic resources, such as rare earths, with minimal domestic processing and without applying suitable taxes or royalties robs WA of the economic and social benefits that should come from the mining of resources that are rare and result in high value/margin products. 3.3.5. Off take agreements and domestic usage Establish strategic minerals status for all New Energy materials. Long-term product off-take agreements are usually sought by mine developers in order to underwrite the capital cost of building resource production on-stream. However, the downside of unconstrained agreements is that such agreements effectively exclude any opportunity for domestic value-add to these resources, which in turn results in lost opportunities for domestic industrial growth. One way of enabling local value-add to be achieved is through recognising ‘strategic resources’ that are not just like iron ore distributed in many places across the globe but are focussed in WA. Awareness of WA’s New Energy metals is rapidly growing. It is therefore recommended that all “new energy” materials should be considered strategic resources. This would need to happen in partnership with the Federal Government. In order to do this it would need:
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