The Royal Australian Navy (RAN) has confirmed plans to transform its existing fleet of naval vessels and aircraft into bio-fuel capable by 2020.
The decision to power the naval fleet by alternative fuels is in line with the US Navy's plans to convert its own fleet using at least a 50-50 fuel blend.
Australia has been offered access to the alternative fuel technology, which is currently being developed by the US military.
Furthermore, the change would support RAN's work with the US Navy on joint operations and would see US warships and aircraft visit Australian bases more frequently.
RAN is currently planning to make about 50 vessels and aircraft compatible with alternative fuels.
Additionally, RAN is likely to send a bio-fuel powered frigate and helicopter to participate in the US Navy's 'Great Green Fleet' demonstration.
RAN rear admiral Tim Barrett was quoted by The Australian as saying: "If the US is going to do it, and if its fleet will operate with mixes of fuel, then we are going to need to be able to do the same thing.
"We take fuel from them when we are operating at sea with their fleet and they take fuel from us."
Noting Australia's current potential to develop bio-fuels as 'embryonic', RAN said: "As the industry becomes established and alternative fuel costs approach parity, the RAN will seek to use blended, alternative fuels."