NSW businesses spending big on energy have a direct way to get government co-funding for climate risk assessments and net zero planning work, but only if that work is delivered by an external specialist consultant. Net Zero Planning Grant Round 2 is open now, covering up to $25,000 toward eligible project costs, at 50% of total project cost. It closes at 5:00pm on 30 November 2026 (AEDT).
For finance and sustainability teams already budgeting for climate risk work under AASB S2, that closing date matters. The terms have also changed since the program's first round, so it's worth checking exactly how Round 2 works before assuming the old numbers still apply.
What the grant actually covers
The grant is built around engaging external expertise: the application asks whether you already have a specialist consultant lined up to deliver the work, and funding is calculated as a share of what that engagement costs, not what your own staff spend on it. Internal project management and labour costs are explicitly ineligible, along with capital expenditure and the purchase of carbon offsets.
In practice, that means the grant subsidises engaging a firm like Trace to do the work, rather than funding a business to do it in-house.
How the funding actually works
Round 2 funds up to $25,000, covering up to 50% of your total project cost. That means the cap only pays out in full if your project costs at least $50,000. If your project costs less, you're funded at 50% of whatever the real figure is. If it costs more, the $25,000 cap doesn't move, so the effective subsidy on a larger engagement works out to less than 50% overall.
This is a change from the program's first round, which split funding into a $4,000 Milestone 1 and a $26,000 Milestone 2 at 75% cost share. Round 2 is structured as a single funding request rather than two fixed milestone caps, though a milestone still matters for cost eligibility: costs paid before the notification that milestone 1 is successfully completed are not eligible for funding.
The application form has you nominate your own project start and end dates rather than working to fixed weekly deadlines. For applicants who are unsure what to enter, the form suggests a start date around 4 weeks after you submit and a completion date around 28 weeks after you submit, as a default rather than a mandated cap.
Who's eligible
To apply, a business needs an ABN and GST registration, a NSW site address and operations, and either at least $200,000 in annual energy expenditure at a single NSW site or $500,000 across multiple NSW sites. Applicants need energy bills no more than two years old as evidence of that spend.
Three groups are explicitly ruled out on the application form. First, businesses that are a Safeguard facility under the Australian Government's Safeguard Mechanism. Second, businesses that have received or will receive funding from another NSW Government initiative for the same activities. Third, and this is a meaningful one for larger organisations, Group 1 reporting entities: businesses required to prepare a sustainability report under section 292A of the Corporations Act 2001 (Cth) are ineligible for Round 2. If your organisation already sits inside Australia's mandatory climate reporting regime as a Group 1 entity, this grant isn't available to you.
What the application actually asks for
The form itself asks for the standard things: proof of your annual energy expenditure, the eligibility declarations above, your total project cost and the amount you're requesting, and details of the specialist consultant you plan to engage. There's no separate business case or competitive pitch document.
The heavier lift is what you commit to on the form itself: the start and end dates you nominate become the delivery timeline attached to your funding deed. Getting a consultant with genuine climate risk and carbon accounting experience briefed and started quickly matters more for getting value out of this grant than the application paperwork does.
What this means for your business
For a business that already knows it needs a climate risk assessment or a net zero action plan, whether to prepare for AASB S2 reporting or simply to plan ahead of it, this grant reduces the cost of getting that work done properly by a specialist, provided your organisation isn't already caught by mandatory climate reporting as a Group 1 entity.
Round 2 closes at 5:00pm on 30 November 2026 (AEDT), and applications go through the NSW Government's SmartyGrants portal. Businesses weighing up whether their energy spend and timeline make this worth pursuing can book a call with Trace to talk through scope and fit before applying: book a call with Trace.
Trace is a climate reporting platform specialising in ISSB and AASB standards, helping businesses navigate mandatory climate disclosure with clarity and confidence.
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