Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Hansard source

At least I can read it, unlike you.

The government is substantially boosting its support for innovation in clean energy as a central element of its clean energy future plan.

A new $10 billion Clean Energy Finance Corporation will invest in the commercialisation and deployment of renewable energy, energy efficiency and clean energy technologies. A new Australian Renewable Energy Agency, or ARENA, will streamline and centralise the administration of $3.2 billion in existing support for renewable energy.

This bill establishes ARENA, the members of its board and its chief executive officer and chief financial officer and sets out how ARENA will operate and will be funded. To ensure that momentum in the renewable energy industry is sustained and quickly built on in the future, ARENA is to commence operation from 1 July 2012.

The government is currently providing substantial support for renewable energy across multiple programs and projects. The government will consolidate and reform the management of these programs and projects by creating ARENA as an independent statutory authority under the Commonwealth Authorities and Companies Act 1997.

ARENA will have oversight of around $3.2 billion in existing renewable energy grant funding currently managed by the Australian government and by Australian government funded renewable energy bodies such as the Australian Centre for Renewable Energy and the Australian Solar Institute.

Around $1.7 billion of this funding is currently uncommitted and will be available for ARENA to provide financial assistance for:

The definition of renewable energy technologies appropriately includes hybrid technologies.

The inclusion of hybrid technologies, by improving the economics of renewable energy projects, can allow ARENA to support more renewable energy projects than would be possible without hybridisation.

Likewise, ARENA will be managing a number of existing projects that involve hybridisation, such as the Solar Flagships Solar Dawn project, the King Island REDP project and the ACRE Solar Kogan Creek project.

ARENA will also be managing a number of existing programs that include hybrid technologies as eligible technologies—including the Emerging Renewables Program and the Renewable Energy Venture Capital Fund. ACRE's strategic directions explicitly recognise the benefits of hybrid systems, and ARENA will be mindful of this in carrying out its activities.

Under the definition of renewable energy I would expect that ARENA could support projects such as solar, biomass, biofuels, ocean and geothermal. Likewise, given that they are largely economic under the renewable energy target, it is not envisaged that ARENA would support stand alone wind projects.

The definition of renewable energy also includes enabling technologies, such as storage.

ARENA will also be responsible for policy advice to the Minister for Resources and Energy and will take over and expand on the activities of the Australian Centre for Renewable Energy in this regard.

A key priority for ARENA will be to act collaboratively with other interested and relevant parties to achieve its goals. To this end ARENA will continue and expand on the good work of:

The ARENA board will include renewable energy technology, business investment, commercialisation and corporate governance experience in order to deliver balanced decisions in terms of project viability and the choice of technology funded. The ARENA board will draw on the considerable talent we have in the Australian business and renewable energy industries. It is intended that the ARENA board be open to cross-membership with the board of the Clean Energy Finance Corporation once it is established. Likewise, recognising the need for a close working relationship with my department to deliver ARENA's objectives, the secretary of my department will be a member of the ARENA board. To advise and assist ARENA in its duties, ARENA will be able to form committees. ARENA will also be able to engage consultants to provide technical and specialist advice. The intention is that ARENA will form technology-specific advisory committees to assist it in performing its functions.

Importantly, the funding to be provided to ARENA each year will be prescribed in this bill out until 2020, providing long-term funding certainty to the renewable energy sector. To ensure efficient use of public funds, funding allocated to ARENA each year will be held by the Australian government and used to earn interest for the Australian public until it is required by ARENA.

An early task for the board will be to develop its funding strategy, guiding how it intends to allocate its uncommitted funds across the various renewable energy and related technology types, ahead of developing program guidelines outlining how eligible stakeholders can access funding.

The legislation also includes a number of accountability provisions—around the development of a funding strategy and around guidelines and procedures to seek approval for guidelines and projects if certain hurdles are met, as well as the need for merit based assessment. These requirements strike an appropriate balance between ARENA's independence and proper accountability.

I expect that the board will manage its affairs in a manner reflecting the highest standards of probity and highest ethical standards and accountability, with program guidelines developed according to merit based principles. As mentioned, the legislation includes provisions to help meet these standards.

This bill is the main bill of two bills related to ARENA's establishment that I am introducing in this session. The other bill I will introduce will provide for the transitional and consequential amendments necessary to transfer various projects and programs across to ARENA and wind up or incorporate the activities, staff and assets of the Australian Centre for Renewable Energy and the Australian Solar Institute.

I commend the bill to the House and simply note the support by the opposition for the renewable energy target of 20 per cent by 2020 and that this bill is central to achieving that objective.

Debate adjourned.

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