"Government support at both the state and commonwealth level is critical if we are to effectively overcome pressing issues and maximise the industry's potential," WA Minister for Mines David Michael said on Tuesday.

Responsibly sourced lithium, nickel, cobalt, manganese, high purity alumina, rare earths and copper would be vital for decarbonisation efforts, he told the Paydirt conference in Perth.

He confirmed the federal government was considering measures, including production tax credits for companies investing in critical minerals processing facilities.

Mr Michael said he was also "encouraged" by Prime Minister Anthony Albanese's recently announced Made in Australia Act and what it would mean for resources-rich WA.

But, he added, a multi-billion dollar battery and critical minerals industry in WA had been in the works for more than a decade.

The new challenge was adding more global-scale investment in processing and battery manufacturing.

Local nickel producers have already gone to the wall amid a glut as China-financed nickel floods the market from Indonesia, as China maintains a stranglehold on factory-ready materials needed by battery manufacturers.

Mr Michael said the federal government's plan to slash environmental red tape would also "go some way" to fixing bottlenecks for investment.

The WA government would, as well, free up industrial land and speed up approvals to support strategic industries.

Major investments by Lynas Rare Earths and Iluka Resources would establish WA as one of the few jurisdictions in the world to offer processing of rare earths, Mr Michael said.

As well as the ingredients for widely used lithium batteries, WA has the resources to support the development of a vanadium battery industry, he noted.

Rare earths are needed for batteries, smartphones, magnet motors, computers and defence technologies, while vanadium is used for long-duration, non-flammable energy storage.

Australian Associated Press