ARENA expands into energy efficiency with IETS

ARENA is breaking new ground with a funding round for Industrial Energy Transformation Studies (IETS), including, for the first time, studies into energy efficiency.

For the first time, an ARENA funding round will include applications for studies into energy efficiency measures.

The IETS Program aims to identify opportunities to reduce energy costs and emissions in the industrial sector.

Studies into both energy efficiency and renewable energy technology solutions will be eligible for funding from a total pool of $43 million.

Grants will be provided in two streams. Stream A will support feasibility studies, while Stream B will be available for engineering studies.

Applicants can seek $100,000 to $500,000 for feasibility studies out of a pot of $13 million. Engineering studies will be eligible for $250,000 to $5 million grants from a $30 million budget.

$2.47 billion total funding package

It’s a big step for ARENA because its remit has previously excluded energy efficiency measures. But recent amendments contained in the Australian Renewable Energy Agency Amendment (Powering Australia) Regulations 2022, have opened the door.

Factory used to to produce process heat
Around half of industrial energy is used to produce process heat.

Announced by the Australian Government in September 2020, the IETS formed part of a $2.47 billion funding package aimed at lowering energy costs, reducing emissions and boosting the economy.

Funding is available to companies and organisations in agriculture, mining, manufacturing, gas supply, water supply, waste services and data-centre sectors.  These sectors are the largest users of energy in Australia. Around half of industrial energy is used to produce process heat for industrial and other processes.


As the name indicates, the IETS focuses on delivering transformative change. That is, change beyond what a business-as-usual approach might achieved.

There are four main, transformational aims:

  1. Improve industrial energy efficiency
  2. Increase renewable energy use
  3. Reduce greenhouse gas emissions
  4. Show how measures can be replicated across similar industrial settings

Applications for both feasibility and engineering studies will open 29 September 2022.

Feasibility study applications will go through a single-stage assessment process, while engineering studies will be assessed in a two-stage process. The program will remain open until funds are exhausted.

ARENA will assess applications on a rolling basis, governed by the quantity and quality of applications received.

The first successful applicants will be notified early to mid-2023.

Credible and innovative solutions

ARENA CEO Darren Miller said the program will create a pathway for emissions abatement among some of Australia’s largest industrial energy consumers.

“Helping large energy users to reduce emissions is essential to decarbonising the economy and helping Australia meet our emissions reduction goals,” Mr Miller said.

“Whether it’s by integrating renewable energy into existing processes or increasing energy efficiency to minimise energy demand and cost, the Industrial Energy Transformation Studies Program will identify credible and innovative solutions to the challenge of reducing emissions in industry.

“As Australian industries look to decarbonise, we must now find smart, replicable solutions to help cut energy costs and reduce emissions in hard to abate sectors.

“Through this program, ARENA is looking to support solutions that can provide blueprints for business across energy intensive industrial sectors,” he said.

ARENA has previously funded a number of projects aiming to reduce emissions in the industrial sector, including: