Bowen frees ARENA from Taylor’s fossil fuel mandate, puts focus back on renewables

The Albanese government has moved to reverse the former Morrison government’s attempts to redirect renewable energy funding to non-renewable technologies, issuing a replacement set of regulations to the Australian Renewable Energy Agency. (ARENA)

Federal climate change and energy minister Chris Bowen said the new set of regulations will restore the agency’s focus on funding renewables, ending years of Morrison government attempts to redirect billions in funds to carbon capture and fossil fuel technologies.

ARENA was established under the Gillard government to provide funding for the research and development of new renewable energy technologies, and formed part of the Clean Energy Package negotiated with the Greens, along with the Clean Energy Finance Corporation and the Climate Change Authority.

It has has been instrumental in the emergence of a competitive renewable energy sector in Australia, particularly large-scale solar and more recently with battery storage and other supporting technologies needed a renewables based grid.

Bowen says ARENA will be provided with a new mandate to “maximise the take-up of renewable energy” and to focus on electrification and energy efficiency.

“The best way to put downward pressure on energy prices is to ramp up investment in renewables and that is exactly what we are doing,” Bowen said.

“This Government is delivering on the Powering Australia plan that we took to the election, which included a major boost to renewable energy supplies to help create jobs, reduce emissions and revitalise Australian industry.

“These regulatory changes will help ARENA work with industry on accelerating electrification as well as increasing energy efficiency that will support the overall transition to renewables.”

The effect of the new regulations issued by Bowen on Friday is to remove the vague terminology of the Morrison government, which had directed ARENA to provide funding towards an open-ended category of “clean energy technologies”.

Labor’s regulations instead seek to empower ARENA to provide funding support for electrification technologies, which could help facilitate the substitution of fuel use with renewable electricity, and energy efficiency technologies.

ARENA’s regulations have been the subject of a multi-year-long political saga after former federal energy minister Angus Taylor took multiple, usually unsuccessful, attempts to change the agency’s regulations to redirect ARENA’s funding away from renewable energy technologies and toward the Morrison government’s preferred technologies.

During his tenure as energy minister, Taylor took three attempts to change ARENA’s regulations with the first two attempts shot down by the federal Senate which objected to the redirection of funding.

Taylor’s regulations variously attempted to direct ARENA’s funds to carbon capture and storage projects, gas projects and a range of freight and industry efficiency programs.

A range of leading legal experts considered the regulations as likely being unlawful as ARENA’s parent legislation limits the agency to funding only projects that either improve the competitiveness of renewable energy technologies or increase their uptake.

Such was the extent of the flaws in Taylor’s regulations, that they were even the subject of criticism from a Coalition controlled scrutiny committee that determined that the regulations were likely to be an unlawful overreach of the minister’s powers and recommended that they be repealed.

Labor’s latest amendments to the regulations close the door on ARENA funding non-renewable technologies and would allow the agency to invest in technologies that would accelerate the transition away from fossil fuels.

Bowen added that the new regulations would provide clarity to ARENA after almost a decade of Coalition attempts to neutralise the agency.

“The previous Government had a pathological detestation of renewable energy, and the work ARENA was created to do by the previous Labor Government,” Bowen said.

“First, they tried to abolish it in Parliament, then they warped its regulations for political purposes. The Albanese Government on the other hand understands the value of ARENA and will let them get back to doing what they were created to do; supporting renewable energy in Australia.”