AMBC chair Craig Nicol told a parliamentary committee into green energy future demand for batteries in sectors being gradually electrified will dwarf the growing market for electric vehicle batteries.

Mr Nicol called for incentives to import the necessary specialised manufacturing equipment to use as starting point, alongside a collaborative approach between industries and academics to grow a local workforce.

"There's something like 10 times more batteries, battery factories and minerals to be built in 10 years. So those factories have to be built somewhere. Why not Australia?" Mr Nicol told the committee.

"Australia, whether it likes it or not, is already supplying most of the minerals in the iPhone, and that was likely mostly dug up in Western Australia and shipped to China to be made into a battery."

READ MORE:

The call comes as the Australian Workers' Union wants the Albanese government to introduce a new tax on exporting critical minerals like lithium, cobalt, and rare earths which are used to manufacture renewables technology.

The union also wants to establish a production subsidy scheme to foster domestic refining, processing and component manufacturing from Australia's own critical minerals.

AWU national secretary Daniel Walton said Australia was lacking a "substantial" national capacity to turn its critical minerals, like lithium, "into anything useful".

"We are relying on the idea that we can just export these raw minerals to China and they will send us back the components and goods we need," Mr Walton said.

"But if Australia wants to make batteries that rival China's, do we think China will be happy to keep selling us the components we need?

"Do we really want to assume that we can keep digging up critical minerals, shipping them to China for processing, and China will just keep shipping them back to us to manufacture batteries? It's not a bet I'd feel confident about."

The federal government is developing a National Battery Strategy which includes looking at research, servicing, and recycling opportunities and establishing a manufacturing precinct.

An Australian-made batteries discussions paper showed the industry could create 34,700 jobs and add $7.4 billion into the economy.

AMBC director Lynette Molyneaux told the parliamentary committee the International Energy Agency expects that markets for energy storage will be worth half-a-trillion dollars a year in the next decade.

Ms Molyneaux said this meant any Australian battery manufacturing industry had the opportunity to participate in a huge "export opportunity" by value-adding its own critical minerals.

She pointed to an "arms race" between Europe, the US and China looking to looking to control the world's EV market.

"And there is an arms race to have access to all of the minerals we produce in Australia," Ms Molyneax said.

"We could be doing far better in terms of manufacturing locally, and capturing the value of the lithium-ion battery before it leaves our shores, so that we can actually build a significant manufacturing sector as a cornerstone to additional manufacturing in Australia."