Commonwealth Bank backs Carnegie Wave Energy with $21m loan facility

ASX-listed Carnegie Wave Energy has secured a five-year, $20 million loan facility from the Commonwealth Bank to help finance the next stage of the Perth-based company’s CETO 6 project.

The $20 million financing deal – the first, in Australia, between one of the Big Four banks and a wave energy developer  – was announced by Carnegie on Thursday, alongside a further loan facility of $1 million (minimum) to go towards the world-leading Garden Island Microgrid (GIMG) Project.

As we reported here at the start of the month, the GIMG Project – to be located on Garden Island, off the coast of Perth – will be the world’s first wave-integrated microgrid project, incorporating the CETO 6 Project currently underway, the existing operating desalination plant, with the addition of solar PV, energy storage and a sophisticated control system.

But the bulk of the CBA finance – which will replace the existing $20 million loan facility Carnegie has with the Clean Energy Finance Corporation (CEFC) – will be used to develop and commercialise the Carnegie’s industry-leading CETO 6 technology, to make it export ready.

Carnegie CFO Aidan Flynn said the company was “enormously grateful” to the CEFC, but welcomed the company’s transition to the commercial banking sector.

“This cost competitive capital from the CBA will help Carnegie take a significant step forward in our development and commercialisation of the CETO technology, including the integration of CETO into a microgrid with other renewable energy sources.

This will put us in a strong position to compete in the global, developing wave energy market.”

The Commonwealt’s general manager of corporate finance, Gary McGrath said the bank saw the  wave energy sector as an industry of the future.

“We are delighted to be the first ever commercial bank in Australia to execute a wave energy finance deal,” McGrath said.

“We are truly excited about the significant prospects for this new clean energy industry.”

CEFC CEO Oliver Yates also welcomed the new deal, noting that the CEFC’s innovative R&D financing structure had provided a model for private sector lenders to follow.

“CEFC’s initial finance enabled the acceleration of Carnegie’s innovative technology and has subsequently drawn in private sources of funding to enable continued progress.

“Securing finance from the commercial banking sector is another important milestone in Carnegie’s growth and is a clear demonstration of Carnegie’s business evolution,” Yates said.