“We remain focussed on securing an agreement with the European Union as soon as possible,” Birmingham will say during an address focussed on international trade and the global economy.
Clean energy could be an “exciting emerging partnership”, according to the speech. “Closer economic ties present opportunities for Australian businesses in areas such as environmental and low emissions technology.”
Australia’s emerging hydrogen industry has captured attention in Europe, particularly in Germany where a multi-billion euro strategy was launched this month to make the fuel “a new and essential pillar in Germany’s energy transition” away from coal.
Germany sees Canberra as a potential long-term, large-scale partner on hydrogen due to Australia’s potential to harness solar and wind power to produce it. Europe’s largest economy has allocated €7 billion ($11.5 billion) for fostering hydrogen technology domestically and €2 billion for international partnerships.
Hydrogen can be turned into electricity or methane to power homes and industry, and can fuel cars, trucks, ships and planes. It can be transported through pipelines as a gas or on ships as a liquid.
Germany has ambitions to become a major hydrogen producer but is unable to ramp up production as fast as it wants in the short term, meaning the nation is likely to consider deals with Australia and some African nations.
Climate change has proved a source of tension in the negotiations with Europe, after France publicly tied Australia’s domestic action on emissions reduction to the proposed deal.
While some EU countries are happy for the agreement to focus on trade in goods and services rather than domestic emissions, some members of the European Parliament will want strong environmental commitments from Australia in the final language.
Birmingham said he was confident an agreement could be reached that assuaged European concerns about climate change but did not bind Australia to any penalties for missing targets under the Paris accord.
“Our negotiations there are tracking very well, and I am confident that there are many areas of mutual interest in environmental areas that we will find text upon which we can all agree,” he said.
EU records show it has raised the “importance of the effective implementation of the Paris agreement” in each round of negotiations with Australia for the last 12 months.
Five years ago, fair trade agreements covered about a quarter of Australia’s two-way trade, but that has increased to about 70 per cent today. Under the impending deals with the EU and Britain, this would be about 80 per cent.
Australia and the United Kingdom will begin formal foreign trade negotiations imminently.
Bevan Shields is the Europe correspondent for The Sydney Morning Herald and The Age.