Hope for renewable energy, as Senate votes to keep Clean Energy Finance Corporation (CEFC)

CEFC saved in the Senate – a rare win for Australian renewables REneweconomy,By Giles Parkinson on 11 December 2013 In a welcome piece of good news for the Australian renewable energy industry, efforts to close the $10 billion Clean Energy Finance Corporation have been thwarted in the Senate, and the innovative green investment bank is set to continue at least until next July, when a new Senate will sit.

Labor, the Greens and independents such as Nick Xenophon and DLP Senator John Madigan combined to reject the government’s bill to dismantle the CEFC. It was able to do after splitting this and other bills (such as that to close the Climate Change Authority) from the bill designed to repeal the carbontax.

The reprieve means that the CEFC will continue investments in new and enabling technologies and projects for at least another six months. It has around 170 projects it is looking at, but according to recent testimony given to a senate inquiry, the CEFC expects to disburse a total of around $1 billion this financial year, unlocking around a further $3 billion in private capital.

It has already allocated around $535 million, but will not reach the $2 billion allowed in its budget because of the uncertainty around its future, the impact of budget cuts to potential co-investors such as the Australian Renewable Energy Agency, the shortage of appropriate large-scale projects, and the difficulty in bringing sufficient numbers of smaller projects to market.

“We are maintaining our focus on progressing new investment proposals, and performing our statutory investment function,” CEO Oliver Yates said in a statement emailed to RenewEconomy. “We believe this best demonstrates the positive role the CEFC can play in assisting businesses and the broader economy. We are very appreciative of the support we have received from our stakeholders.”

The Greens said that renewable energy is key to a low carbon future and the CEFC will play a critical role. “The CEFC is working and needs to stay,” Greens leader Senator Christine Milne said in a statement. “If the Prime Minister’s attack on the CEFC had been successful it would have been a major blow to Australia’s burgeoning renewable energy sector.”

There is a view in some quarters in Canberra that the “politics” around the CEFC is changing. Those that hold this view say that Yates and CEFC chair Jillian Broadbent have argued their case well, and the CEFC proposition – that it can meet up to half of Australia’s targeted emission reductions by 2020, and produce a net benefit of $2.40 per tonne of CO2-e, and return a surplus to the budget – is compelling.

It is thought that the CEFC could benefit from its stay of execution, because it will allow time for the government to conduct its inquiry into Direct Action, and study exactly how that is to be structured, and meet its targets. It may dawn on policy makers that they have no choice but to retain the CEFC, and allow time for hardline rhetoric to dissipate……http://reneweconomy.com.au/2013/cefc-saved-in-the-senate-a-rare-win-for-australian-renewables-45540