The federal government’s $310 million Small Business Energy incentive to encourage small businesses to invest in batteries, electrification and heat pumps to support the energy transformation has been labelled a waste of money.
The managing director of Australian solar company, Smart Commercial Solar, Huon Hoogesteger, said the 20 per cent tax deduction on spending that supports electrification and more efficient use of energy will not have much of an impact.
Hoogesteger said the deduction amounts to less than $130 per week.
“Forgive my scepticism of vote-grabbing headlines, but 95 per cent of small businesses are not the ones that have the spare cash to be spending on non-core business items; money will be wasted on businesses who are already doing something,” he said.
“This cash won't stimulate new markets and it's a relatively small amount of money when you consider there are 2.4 million small businesses in Australia, most of them people in cars and utes. Even so, that equates to less than $130 each.
“Even if we go to supply the potentially 90,000 businesses that are slightly bigger, this will have absolutely no impact on the majority of small businesses.”
Huon did welcome the creation of a national Net Zero Authority because the need for training and re-skilling the Australian workforce is immediate.
“The Authority can help re-train people into jobs as we move away from coal-fired power stations,” he said.
Treasurer Jim Chalmers said the incentive will help small businesses make investments like electrifying their heating and cooling systems, upgrading to more efficient fridges and induction cooktops, and installing batteries and heat pumps.
“It will support investments that deliver ongoing power bill savings for businesses, while at the same time helping Australia lower emissions,” he said.
“Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000 per business.”
Eligible assets or upgrades will need to be first used or installed ready for use between 1 July 2023 and 30 June 2024.