CEFC backs Ararat wind farm, in sign Abbott investment ban lifted

One the few major new wind projects being built in Australia as a the result of the ACT’s first wind auction – the 240MW Ararat wind farm in western Victoria – has won $67 million in financial support from the Clean Energy Finance Corporation.

The funding, part of a five-year, $276 million senior secured debt financing, comes just five months after the CEFC was directed by the former Abbott government to cease all investment in wind and solar energy.

Of course, this position has gradually softened since Abbott was replaced by the more moderate Malcolm Turnbull, with environment minister Greg Hunt telling ABC Radio National in September that the Coalition – which still has not ruled out scrapping the CEFC – may now support investment in emerging wind energy technologies.

Hunt said the renewables industry should feel “very supported” under new Prime Minister Malcolm Turnbull and his focus on innovation.

As we reported here, contracts for the Ararat wind farm were signed in June, within a day of the reduced renewable energy target bill passing the Senate.

The project is being built by a consortium including RES Australia, GE and Downer, with financing also coming from shareholders Partners Group and Canadian pension fund OPTrust.

The announcement of the CEFC funding, on Wednesday, shows how far Coalition attitudes to renewable energy have come since Abbott was ousted.

“It’s unlikely we would have seen this investment under Tony Abbott, but I think time will tell whether these investments become a regular thing,” said Andrew Bray, national co-ordinator at the Australian Wind Alliance.

“This is the first investment the CEFC has made in wind farms since control for the corporation was moved into the environment minister’s office, so that’s potentially a good sign,” Bray told Fairfax media.

“Given how few projects have started to proceed under the RET since the evolution of a new lower target, there is still clearly a role for the Clean Energy Finance Corporation.

“I think the market is still really recovering from the drubbing it got from Tony Abbott. The Renewable Energy Target now has a clear direction … that there is an estimated 3800 megawatts of new, large-scale renewable energy that needs to be kicked off in the next 12 months to meet the target, so it’s really important these projects get underway.”