Macfarlane renews ARENA board, still set on repeal | RenewEconomy

Macfarlane renews ARENA board, still set on repeal

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Government changes mind and re-appoints two directors, but still aims to dump ARENA – despite overwhelming support in submissions.

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(This story has been updated to reflect the funding changes to ARENA included in the passage of the carbon repeal bill).

The Australian government has had a last minute change of heart and decided to renew the contracts of two directors of the Australian Renewable Energy Agency,  but is still set on repealing the ARENA Act and depriving the agency of further funding.

As RenewEconomy reported on Thursday, Industry Minister Ian Macfarlane allowed the terms of ARENA chairman Greg Bourne and director Judith Smith to lapse earlier this week without any notice of renewal.

It seems that it was only after RenewEconomy reported on the appointment of another bureaucrat, Industry Department deputy secretary Martin Hoffman to the board, and pointed out the lack of commercial, business and renewable energy expertise on the board demanded by the act, that it seems the department sprang into action.

Within hours of RenewEconomy’s article being published, ARENA was informed that the terms of Bourne and Smith would, in fact, be renewed for another 12 months. They had heard nothing up till that point.

However, the government made it clear that it intended to dismantle ARENA, absorb current commitments into its bureaucracy, and close it down for new funding.

ARENA had around $3 billion to spend over the next 10 years. But in his statement Macfarlane mentioned only the $1 billion that has currently been committed.

In the May budget, the Abbott government broke a pre-election promise and said it would close ARENA, and reabsorb the unspent money. Ricky Muir and the Palmer United Party have since said they would block that repeal, but they allowed through some $430 million of budget cuts and $370 million of budget deferals.

“The Board will ensure continuity for ARENA processes, including the assessment of any new project applications, and a smooth transition as the Government continues transition arrangements following the introduction of the ARENA Repeal Bill,” Macfarlane said in his statement.

“The Government supports the energy and resources sector and recognises the role renewable energy plays in Australia’s diverse energy mix.”

The stalling by the government came despite a plea from ARENA, in its own submission to a Senate inquiry, that the ARENA act was supposed to take its activities “away from day to day politics” and allow a “long term focus consistent with the long term investment needed to build a successful renewable energy resource for the nation.”

More than 100 submissions were filed to the Senate committee looking at the proposed repeal. Almost all the submissions – with the exception of the gas industry – supported retaining ARENA.

Spanish solar giant Abengoa said ARENA was crucial to support projects such as the proposed 20MW solar thermal and storage facility being considered for Western Australia.

“Abengoa’s experience in developing solar thermal markets in Spain, USA and South Africa suggests that unlocking Australia’s potential in this sector will have a significant impact on job creation, both in direct construction and indirect supply chain employment,” its Australian CEO James Harding said,

The NSW governemnt also supported it, saying it has a “unique and crucial role in providing funds to develop technologies and to improve investor confidence in renewable energy projects”, and strengthen those projects’ chances of success.

“ARENA is helping to lead Australian researchers, who are world-renowned in certain renewable technology segments, to extend their leadership, while bringing a renewed focus to demonstration and commercialisation of renewable energy solutions,” NSW environment Minister Rob Stokes said in his submission.

“By focusing on achieving commercial outcomes in Australia – using both local and foreign technology – ARENA will help to ensure that the Australian economy benefits fully from its renewable energy investments.”

SA Power Networks, which operates the grid in that state, says the growth of rooftop solar PV is inevitable and the role of ARENA was essential to help find “new and innovative ways” to utilise renewables to reduce the impact on network costs and customers’ bills.

It said such projects that are “unlikely to proceed” if ARENA is abolished.

“No other agency supports projects along the commercialisation pathway from basic laboratory research to large-scale pre-commercial activities. SA Power Networks considers that such support is essential to position Australia to maximise benefits from the inevitable transition toward renewables and other emerging energy technologies.”

ARENA, in its own submission, noted that the act was supposed to take its activitis “away from day to day politics” and allow a “long term focus consistent with the long term investment needed to build a successful renewable energy resource for the nation.”

SA Power Networks, which operates the grid in the state, says the growth of rooftop solar PV is inevitabl and the rol of ARENA was essential to help find “new and innovative ways” to utilise renewables to reduce the impact on network costs and customers’ bills.

It said such projects that are “unlikely to proceed” if ARENA is abolished.

“No other agency supports projects along the commercialisation pathway from basic laboratory research to large-scale pre-commercial activities. SA Power Networks considers that such support is essential to position Australia to maximise benefits from the inevitable transition toward renewables and other emerging energy technologies.”

The only dissenting submission published so far was from Gas & Energy, the peak body for the LNG industry, which complained that the renewable energy agency was focused on renewables. (No, really, that’s what they said).

“Gaseous fuels are already a significant part of Australia’s energy mix and have the potential to contribute further to reducing GHG emissions, as well as increasing energy security, improving air quality,” …. it said.

ARENA’s submission noted that it has already achieved a bunch of world “firsts”:

Weipa – Australia’s first mine site to incorporate renewable energy.

AGL – the largest solar facility in the southern hemisphere deployed across two sites, Broken Hill and Nyngan

Geodynamics – Australian first energy produced from Enhanced Geothermal Systems

CSIRO – world first supercritical steam produced from solar thermal

Carnegie – world first commercial scale wave energy array project connected to the grid and producing desalinated water

BlueScope – first integrated PV and thermal rooftop system in Australia

“A number of ARENA’s projects are real game changers and are evidence of the ingenuity and significant knowledge capital that Australia has in renewable energy development,” I said.

“ARENA’s funding is supporting many of Australia’s world leading researchers, particularly in solar research innovation, and supporting areas where Australia is globally competitive.”

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1 Comment
  1. Clayton Drury 6 years ago

    Well done, Giles. Thank you for continuing to ask the questions that should be asked.

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