The Clean Energy Finance Corporation, one of the three core bodies that Tony Abbott’s new Coalition government has vowed to dismantle, has claimed that its initial investments have resulted in the saving of nearly 4 million tonnes of C02 equivalent – at a negative cost (or a net benefit) of $2.40/tonne.
The number was included in the first annual report lodged by the CEFC on Thursday. If the new government has its way, it will also be its last.
The new government has vowed to close the CEFC, which was to invest $10 billion over a four period, because it describes it as a waste of taxpayers’ money. It has also closed the Climate Commission, is moving to close the Climate Change Authority, and plans to repeal the carbon price, and replace it with Direct Action, and an emissions reduction fund that will seek the lowest bids for abatement.
It is doubtful, however, that many companies will propose to pay the government to achieve abatement under the auction system. But that is exactly what the CEFC is claiming it has done, through investments in energy efficiency and other technologies that it says have delivered 3.9 million tonnes of CO2-e abatement at a negative cost (net benefit) of $2.40 a tonne.
This should not be a surprise, CEFC chair Jillian Broadbent writes, because it is consistent with the outcomes with similar institutions in the US, China, Germany, Brazil and the UK.
“Australia has made a valuable investment in establishing the CEFC as a flexible and low cost policy tool,” Broadbent writes. “Combining finance and energy technology, market know-how, and the staff and assets of LCAL, the CEFC has demonstrated a capacity to mobilise private capital to achieve emissions reduction.”
Broadbent says that the CEFC has so far been able to attract $2.90 of private funds for every $1 of CEFC investment. This has leveraged a total of $1.55 billion in private capital to date.
“Our pioneering of new aggregation finance and corporate facilities has increased awareness and adoption of energy efficiency across a broad market sector. This has encouraged the development of new employment opportunities and assisted the growth of new enterprises.”
Despite the positive spin in the annual report, there is growing pessimism within the CEFC about its ability to survive Abbott’s putsch against all things climate and clean energy. The new prime minister has surrounded himself with senior business people who don’t accept climate science and who disapprove of renewable energy. Moderates within the party are just a faint voice.
CEFC chief executive Oliver Yates writes in the annual report that some $2.2 billion of projects had so far been committed, with 56 per cent of these in renewables, 30 per cent in energy efficiency and 14 per cent in low emissions technologies.
A further 37 proponents for $4.5 billion in projects had been assesses, and a further 142 projects totalling nearly $15 billion had been proposed.
“We have only scratched the surface of opportunities available,” Yates writes. “We believe we have demonstrated clearly the effectiveness of an investment model as a natural complement to the suite of other government policies directed at achieving emissions reductions.
“The experience of comparable institutions established in other major economies has shown that the CEFC model utilising the ‘discipline of debt’ offers significant benefits, as we can drive investment at no cost to the taxpayer.
“Our operation represents a unique asset to the sector. The CEFC comprises a team of professionals experienced in infrastructure and energy finance who have deep passion and commitment to the public policy purpose we serve.”
All admirable stuff. But it’s falling on deaf ears. As Greg Hunt, environment minister, told a Carbon Markets Association workshop on Direct Action last week, there is some “exciting” options for reducing emissions on brown coal. They might even be ready by the end of the decade. Hooray!