PLEA Network

23 March 2016, Renew Economy, Turnbull’s sleight of hand on clean energy investment. Prime Minister Malcolm Turnbull has put his own stamp on clean energy investment in Australia, dumping Coalition plans to scrap the Clean Energy Finance Corporation, but announcing new plans to essentially de-fund the Australian Renewable Energy Agency and replace it with a new “Clean Energy Innovation Fund.” The retention of the CEFC will be welcome and signals a potential shift from the anti-renewable policy stance of the Abbott regime that preceded him. But the move to de-fund ARENA and create a “new” fund using money already allocated to the CEFC is nothing but a sleight of hand, and an elaborate ruse by Turnbull to save more than a $1.3 billion and get his new pet-word “innovation” included in a financing scheme. It may also be designed to meet Australia’s Paris commitment to invest “new money” in clean energy innovation. But the move may back-fire, because although the new set-up will continue to support near commercial projects, the technologies and ideas at the formative stage of the innovation process may be left stranded, without funding. According to the former chairman of ARENA, Greg Bourne, Australian innovation may move overseas to get the necessary support. So much for the innovation nation. The Turnbull government has been showing less interest in ARENA, and its cost to the budget, and over the last few months has allowed not renewed contracts for directors, and allowed it to narrow to a single director, the head of Greg Hunt’s environment department. ARENA will continue to manage its current projects, and complete its $100 million funding program for large scale solar projects. But after that its funding will be stopped and it will effectively be morphed – along with its staff – into an annexe of the CEFC and the new fund. Under the new plan hatched by Turnbull and Hunt, ARENA’s grants-based funding strategy will be replaced by “innovative” finance such as debt and equity funding – effectively lending money and buying shares in the investments. Read More here