Taylor has third, last-gasp crack at regulations to redirect renewable energy funding

Federal energy and emissions reduction minister Angus Taylor has made another attempt to change the investment remit of the Australian Renewable Energy Agency – the third attempt in just ten months and less than a week after the last effort was knocked down by the senate.

The third iteration of regulations issued by Taylor for the renewable energy funding body are less explicit in their attempt to redirect its funds to the government’s preferred technologies, including non-renewable energy technologies, including carbon capture and storage.

But by expanding ARENA’s investment remit to include funding “clean energy technologies”, the new regulations still create the potential for funds to be directed to non-renewable technologies.

The regulations – released just days before a federal election is expected to be called – tie the definition of “clean energy technologies” to that adopted by the board of the Clean Energy Finance Corporation.

It is an unusual arrangement that will effectively allow the board of the CEFC to dictate how the funds of ARENA may be allocated.

The explanatory statement issued by Taylor that accompanies the regulations makes clear that the government still hopes to expand ARENA’s functions to funding non-renewable energy technologies, despite ARENA’s legislation making clear the agency’s purpose is to only support the development and deployment of new renewable technologies.

“ARENA’s legislated functions are currently limited to supporting renewable energy technologies,” the explanatory statement says.

“This restricts ARENA’s ability to support important low emissions technology innovation in Australia and delivery of the 2020-21 Budget programs, which each drive emissions reductions but may contain elements that are not within the subject matter of renewable energy.”

“The Regulations provides ARENA with the necessary authority to deliver any non-renewable elements of the programs, supporting emissions reductions through broader clean energy technologies such as energy efficiency and non‑renewable low-emission technologies.”

An earlier set of regulations – determined to be unlawful by an influential senate oversight committee as they were inconsistent with the legislation establishing ARENA – were cancelled out by the federal senate on Monday.

That cancellation was triggered by a motion moved by conservative Liberal senator Concetta Fierravanti-Wells, who chairs the Scrutiny of Delegated Legislation committee and who later slammed prime minister Scott Morrison as “bully who has no moral compass” in a sensational speech to the senate.

Following that cancellation, a spokesperson for Taylor told RenewEconomy at the time that “the government will revisit the regulation in the immediate future.”

A spokesperson for ARENA said the regulations were a matter for the minister and parliament.

“We remain committed to our strategic priorities, and supporting Australia’s shift to net zero,” the spokesperson told RenewEconomy,

“We remain supportive of increased flexibility to invest across new technologies that will be needed for net zero.”

“No current funding agreements are impacted by the disallowance this week.”

“ARENA is already working on supporting a wide range of priority low emissions technologies including ultra low cost solar, hydrogen, large scale storage and low emission metals,” the spokesperson added.

Taylor’s first attempt to change ARENA’s regulations was also scratched out by the senate in June last year, after Labor, the Greens and the senate cross bench combined to successfully pass a “disallowance” motion.

Taylor’s third attempt at replacing the ARENA regulations may be one of the last, if not the last, of Taylor’s acts as the federal energy minister, given the next election is expected to be called imminently and Labor retains a commanding lead in the polls.

Taylor’s time as minister has featured constant complaints about “too much wind and solar” in the grid, and repeated attempts to direct funding from CEFC and ARENA to preferred technologies such as CCS, as well as controversy over the flagship Emissions Reduction Fund.

Taylor has also failed to legislate key pieces of Morrison government energy policy, with legislation establishing the $1 billion Grid Reliability Fund and a $500 million Low Emissions Technology Commercialisation Fund never passing parliament.