Stop paying miners to burn diesel. Pay them to electrify.

July 24, 2026

Recent research shows big fossil fuel-consuming and carbon-emitting industries are receiving billions of dollars in credits from taxpayer dollars. We and others think it could be better to cap those subsidies and reward electrification instead.

Every year, Australian taxpayers hand mining companies billions of dollars in diesel fuel tax credits.

This week, Labor's national conference amended the party platform to open the way to winding back the rebate for big miners and we are calling on the Prime Minister and Cabinet to back it in.

The numbers are staggering:

The fuel tax credit scheme costs around $11 billion a year and is forecast to forecast to increase by almost $1bn each year.
Nearly half goes to mining. The big miners have banked $60 billion over the past 20 years.
BHP alone claimed $622 million in 2025. Rio Tinto, more than $423 million. (Climate Energy Finance analysis)
Australia burns more diesel per person than any other major economy - 83% more than the US and 700% more than China.

Rewiring Australia CEO Francis Vierboom says: “Australia can't afford to keep subsidising fossil fuels while households are working to cut their energy costs and emissions.

"This is a reform with huge benefits on offer to Australia. For now, we're the World Cup champions of burning fuel: thanks to our big mining, agriculture and transport industries, we use far more diesel per capita than any other major economy.”

There's a smart fix on the table which Rewiring Australia is fully behind. Climate Energy Finance proposes capping credits at $50 million per company, with anything above that returned only when it's matched by investment in electrification. That would redirect over $2 billion every year into electric trucks, machinery, batteries and renewables.

Francis adds: "This is a clear, smart solution: stop paying out billions to the miners for every litre of diesel they burn, and spend that money on helping the sector invest in going electric instead.

"The result: we get a resources sector that's got vastly higher energy productivity, is more secure and resilient to global shocks, and runs on Australian-made electricity instead of oil on ships across vast supply chains.”

The good news is that in 2026 it can be done.

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