New round announced 5 February 2026 – The Safeguard Transformation Stream (STS) forms part of the Powering the Regions Fund, announced under the Australian Government’s Powering Australia plan.
Originally released in January 2023 as part of the Government’s Safeguard Mechanism Reforms, the STS supports Australia’s ambition to become a renewable energy superpower.
The Australian Government has committed a total of $600 million over the life of the program. For this first round of the Powering the Regions Fund – Safeguard Transformation Stream, up to $300 million is available over four years.
Objectives of the Safeguard Transformation Stream
The grant opportunity is designed to:
- Support trade-exposed facilities covered by the Safeguard Mechanism to reduce emissions and contribute to Australia’s 2030 and 2050 emissions reduction targets
- Reduce the risk of carbon leakage, where emissions-intensive production shifts to countries with less stringent climate policies
- Support skills development for the existing industrial workforce, enabling the adoption of new equipment and processes that reduce Scope 1 emissions
Intended Outcome
The intended outcome of this grant opportunity is a measurable reduction in emissions at trade-exposed Safeguard facilities, consistent with their obligations under the Safeguard Mechanism.
Who is this for?
Owners or operators of a trade-exposed Safeguard Mechanism facility that is not a new or expanded coal or gas production facility.
Funding Amount:
The Powering the Regions Fund – Safeguard Transformation Stream Round 2 grant opportunity will provide up to $50 million to trade exposed facilities to reduce their emissions and contribute to meeting Australia’s emissions reduction targets.
Eligibility:
You can apply if you:
- are an eligible entity
- have an eligible project
- have eligible expenditure
Eligible Entity requirements, you can apply if you:
- are an owner or operator of a trade-exposed safeguard mechanism facility that is not a new or expanded gas or coal facility
- have an Australian business number (ABN)
and are one of the following entities:
- an entity incorporated in Australia
- company limited by guarantee
- incorporated association
You can’t apply if you are:
- the owner of a trade-exposed Safeguard facility that is also a new or expanded coal or gas facility
- an organisation, or your project partner is an organisation, included on the National Redress Scheme’s list of Institutions that have not joined or signified their intent to join the Scheme
- an employer of 100 or more employees that has not complied with the Workplace Gender Equality Act (2012).
Partner with other organisations
You can partner with one or more other organisations that also meet the eligibility criteria. But you must decide who the lead organisation is.The lead organisation must fill out the application form.
Eligible Project requirements:
You must complete your project by 31 March 2033.
The maximum project period is 60 months.
Your project must:
- be aimed at contributing to Australia’s emissions reduction targets.
Your project must be delivered in one of the following locations:
- on-site at any eligible facility, or
- shared infrastructure, with practical connection to an eligible facility and the grantee, located in Regional Australia (defined as any area outside a Greater Capital City but including Kwinana).
Eligible Expenditure:
You can apply for a grant between $500,000 and $50,000,000.
You can use this grant funding for:
- newly purchased or pre-existing plant and equipment
- hired/leased plant
- constructed plant
- labour expenditure and on-costs
- contract expenditure
- staff training that directly supports the achievement of project outcomes
- decommissioning old equipment
To be eligible, expenditure must:
- be incurred by you, or your project partners (if applicable) within the project period
- be a direct cost of the project
- be incurred by you, or your project partners (if applicable) to undertake required project audit activities (where applicable)
- meet the eligible expenditure guidelines.
Applications will be assessed in batches:
- Batch 1: 5 February 2026 – 5 May 2026
- Batch 2: 6 May 2026 – 5 November 2026
- Batch 3: 6 November 2026 – 6 May 2027
