Senate backs Greens call for ARENA funding extension as money dries up | RenewEconomy

Senate backs Greens call for ARENA funding extension as money dries up

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Senate passes motion calling on the Morrison government to extend the life of the Australian Renewable Energy Agency that faces funding cliff.

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AGL Energy's Nyngan solar farm (Supplied).
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The Australian Senate has passed a motion backing the Australian Renewable Energy Agency (ARENA), and calling for more funding to be allocated to the agency that has had a substantial role in nurturing innovations in Australia’s clean energy sector.

The motion was moved by Greens co-deputy leader Larissa Waters earlier this week, who called on the Morrison government to effectively reverse a series of funding cuts that had been passed with the support of the Labor party.

“ARENA has been an unbridled success in bringing down the cost of solar, driving new technologies and developing the hydrogen and bioenergy future of this country,” Waters said.

“In the last Parliament, the Liberals and Labor teamed up to cut ARENA’s legislated funding by half a billion dollars. It’ time ARENA’s funding is restored so they can continue to drive this necessary energy transformation.”

Government senators offered little in response to the motion, with the assistant minister for forestry and fisheries Jonathon Duniam saying on behalf of the government only that “funding decisions are a matter for government and will be considered in due course.”

The motion was passed by the Senate without needing to call a division for a vote.

ARENA was set up in 2012 under the Gillard government and was initially allocated $2.5 billion to provide as grant funding for research and demonstration projects for new and emerging renewable energy technologies.

Since then, there have been multiple attempts to abolish the agency, or cut its funding, but the agency largely survived due to its success and popularity. The funding was initially cut by $435 million with the support of Clive Palmer in 2014 in a deal that prevented the agency being abolished altogether by the Abbott government.

Its funding was cut by a further $500 million with the support of the Labor party in 2016, in a deal that again sought to prevent the agency from being wound up.

ARENA representatives told a senate estimates hearing in December that the agency had just $200 million in unallocated funding, and with no prospect of additional funding, is expected to exhaust its funding by the middle of this year.

While ARENA will continue to administer its existing funding arrangements, it will not be able to support new projects once the funding is fully allocated.

Of the remaining funds, $70 million has already been  set aside to support projects developing renewable hydrogen production and export technologies.

The motion follows a similar call for an extension to ARENA’s funding from think tank The Australia Institute.

In analysis that was cited in the senate motion, the Australia Institute pointed to the fact that successive coalition governments have heaped praise on ARENA, claiming credit for the substantial achievements of the agency in driving down the costs of renewable energy and supporting new clean energy technologies to enter the market.

The emergence of Australia’s large-scale solar sector was largely underpinned by funding provided by ARENA, which financially supported the Nyngan and Broken Hill solar farms, which paved the way for the surge in solar projects in recent years.

The Australian Greens motion supporting ARENA funding.

While the Greens motion did not call for a specific funding commitment from the government, it requested that federal energy minister Angus Taylor ensure that ARENA is allocated funding to allow it to continue supporting research and development projects in the clean energy sector beyond 2020-21.

With the federal Large-scale Renewable Energy Target expecting to be met this year, with no prospect of a more ambitious target in future years, and the looming funding cliff being faced by ARENA, Australia’s clean energy sector may soon be without two of the most effective policies that have supported the recent strong growth in renewables uptake.

In a separate motion, the Australian Greens also sought to force the Morrison government to release the documents it has received relating to a proposed new coal-fired power station in North Queensland. However, the motion was defeated in a tied vote, with One Nation senators voting against the motion.

“And again One Nation are protecting the Government – now they’re voting against releasing documents about how the Collinsville power station feasibility study got ordered (we all know it was hush money for rebel Nats) and whether the Department advised against it. Vale transparency!” Waters said.

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