The Australian Renewable Energy Agency is continuing to assess applications for the remaining $1.3 billion of uncommitted funding in its budget, despite uncertainty over its future, the ARENA annual report for 2014/15 has revealed.
The report also highlights priority areas for the coming year, including large-scale solar photovoltaics, off-grid and fringe-of-grid technologies, and the integration of renewables into grids.
Founded in 2012 under the Gillard government, the entity holds approximately $2.5 billion in funding to “improve the competitiveness of renewable energy technologies and increase the supply of renewable energy in Australia”.
Although the original timeframe for the agency to deliver its objectives was set at 2022 (with an intent to provide competitive energy solutions up to 2030-40), the future of the agency came into question after former Prime Minister Tony Abbott announced in the 2014/15 budget that the government would axe the statutory organisation and reallocate the remaining $1.3 billion of project funds to the Department of Industry (the move cemented Abbott’s reputation as being “anti renewable”, as he had also previously sought to terminate the Clean Energy Finance Corporation).
As such, in June last year, the Australian Government tabled the Australian Renewable Energy Agency (Repeal) Bill 2014, which sought to abolish ARENA as a statutory entity. However, despite being introduced to the Senate on the 2 September 2014, a date for consideration of the bill has not yet been determined.
In ARENA’s annual report for 2014/15, chair Greg Bourne said that “Australia’s challenge lies in fully realising its renewables potential and taking advantage of [renewable] resources”, adding that the agency would continue to invest its money in new projects until a definitive decision had been made by the Senate.
He wrote: “The renewables industry in Australia has faced much uncertainty over the past year leading to a dramatic drop in investment during 2014-15. With government legislation to abolish the agency still to be considered by the Senate, ARENA has faced similar uncertainty over the period. However, until enacted, ARENA very much remains open for business, with funding available until 2022.
“In the coming year we will be seeking to invest in a number of new priority areas including large-scale solar photovoltaics, off-grid and fringe-of-grid, integrating renewables into grids, and renewables for industrial processes.
“Added to ARENA’s current investment portfolio, projects in these priority areas will not only help Australia to realise and benefit from its vast renewables potential, but become a leader in renewable technology and know-how and create options for Australia’s energy and industry future.”
Chief executive Ivor Frischknecht added: “Looking ahead, ARENA has $1.3 billion in uncommitted funds. At 30 June 2015 we were assessing 116 applications that were seeking $1.4 billion in ARENA funding for projects worth $4.5 billion, of which only some will secure our investment.
“We will continue to target our investments towards a renewable future by creating the conditions that accelerate change and increase the bankability of emerging renewables.”
However, the effect of the agency’s uncertain future can be seen in the reduction of staff on payroll; staff numbers have reduced by 30 per cent in a year, with the number of departmental staff dropping from 72 to 51 in a year.
Annual report details
According to the annual report, the Australian Government provided ARENA with $244.4 million in revenue for ARENA operations.
This brings the total amount of funding committed or spent by the agency to $1.1 billion (for projects with a total value of $2.7 billion).
The largest allocations of financial assistance were given to: AGL’s 155-megawatt solar farm project in NSW ($167m) – said to be the largest solar PV plant in the southern hemisphere; Moree Solar Farm’s solar farm in NSW; Southern Cross Venture Partners’ Renewable Energy Fund ($100m); Jemalong JSS’s 30 megawatt solar thermal energy project in NSW ($39m); and Power and Water Corp’s solar energy transformation project in the Northern Territories ($35m).
Indeed, solar continued to be the agency’s largest area of focus, with more than half of all the agency’s projects (148 of 232) focusing on solar technology. Other ARENA-supported projects involved the first-ever array of wave power generators connected to an electricity grid (the Carnegie Wave Energy project, pictured above), the production of green crude from microalgae, and a number of renewable energy options for thermal energy.
The report also showed that ARENA had a net surplus of $22.9 million for 2014/15 – but this was said to be as a result of “accounting requirements to report a number of items funded through revenue on the Statement of Financial Position” which, all things being equal, is expected to be reversed in 2015-16.
It concludes that the continued existence of ARENA in its present form and with its present programs is now dependent on: government policy and the continuation of its act; continued funding under the legislation for ARENA’s administration and programs; and the Secretary of the Portfolio Department making sufficient staff available.