THE May Federal Budget's $741 million for climate change initiatives in the next five years is inadequate, says a University of Queensland business academic.

UQ Business School academic Associate Professor Andrew Griffiths says the Federal Budget has little to offer from a 'climate-friendly' point of view.

"The centrepiece of the climate change initiatives is the rebate for solar cells for domestic users and money for the establishment of a climate change centre," he says.

"From a climate-friendly business point of view, the Budget has little to offer. It would appear that climate change and the broader issue of sustainability has taken a back seat in line with the Government's desire to spin its economic credentials."

Dr Griffiths anticipates the Government will wait for the report from its business task force on emissions trading before announcing further spending on climate change.

"A significant opportunity has been missed to announce new initiatives on things like rebates for new low emissions technology to encourage research endeavours on climate change - mitigation and adaptation to encourage greater electricity infrastructure development, with a view to reducing greenhouse gas emissions and further incentives for business to implement energy efficiency projects," he says.

The State Government has announced a $619,000 Smart State Innovation Projects Funds grant to the University of Queensland as part of a $1.8 million funding package.

"The University of Queensland is undertaking fundamental research into managing biosolid waste and improving waste technology," says Premier Peter Beattie.

"The funding will be used for the development of a new treatment plant in Queensland to service the meat-processing industry and small-scale sewage treatment plants for regional towns with fewer than 100,000 people.

"Larger facilities already have suitable advanced waste processing technology, but smaller-scale treatment plants and food suppliers are lacking the same level of technology. This project will help address that issue."

Mr Beattie says the university's research and technology will benefit Queensland.

"Queenslanders currently produce about 2000 tonnes of wet, organic solids per day costing $40 million a year to process - with substantial environmental costs including greenhouse gas emissions," he says.

"This project has the potential to reduce CO2 emissions by approximately 140 tonnes a day, which is the equivalent to removing 35,000 cars from the road.

"The cost of Queensland's biosolids could also be reduced from $120 million a year to $40 million a year and the new treatment plant would yield renewable electricity and organic fertiliser.

"It is envisaged that the electricity produced from one of these plants would be sufficient to support 578 households," he says.