Challenge-led innovation policy in Australia

This project, led by Rob Raven, Christoph Brodnik, Xue Ruo Ng and Megan Farrelly from Monash University, analyses Australia’s research and innovation (R&I) policy through the lens of ‘three frames’:

• innovation for growth (Frame 1), which focuses on R&D investment and economic competitiveness;
• national systems of innovation (Frame 2), which emphasises coordination, collaboration, and institutional linkages; and
• transformative change (Frame 3), which aims to address major societal challenges through system-wide transitions.

The study provides a snapshot of Australia’s R&I policy evolution, maps Australia’s federal R&I policy landscape and applies the framework to the Electricity and Energy Sector Plan 2025.

The authors find that Australia’s energy transition policy is dominated by Frame 1 and Frame 2 approaches. The sector plan relies heavily on large-scale investment, infrastructure deployment, market incentives, and support for commercially viable technologies, with a tendency to focus on economic growth, cost reduction, energy security, and international competitiveness. Alongside this, sophisticated governance and coordination mechanisms bring together government agencies, industry, and research organisations to improve system performance and manage the transition. Although the policy language frequently refers to transformative goals, these Frame 3 aspirations are often not concretely operationalised through dedicated funding, implementation mechanisms, or participatory governance structures.

The report concludes that Australia’s energy transition policy is economically, technically and institutionally strong but only partially transformative, revealing a gap between ambitious policy narratives and the concrete tools needed to deliver inclusive, systemic change.