The Clean Energy Finance Corporation is fighting for the renewable energy industry by providing an initial investment of around $80 million to the industry.
Australia’s investment in renewable energy amounts to only around $40 million from January to June this year, the lowest in almost 13 years. The Greens and Labour parties had earlier proposed a double dissolution challenge in the form of an election to Abbott after a bill scrapping the Clean Energy Finance Corporation was voted down by the Senate for a second time.
Clean Energy Finance Corporation Intact Despite Setbacks
This situation follows Prime Minister Tony Abbott’s repeal of the tax on carbon emissions. Independent senator Nick Xenophon, the Opposition, and the Greens are against abolishing the $10 billion-worth corporation even in the face of a panel assigned by the Australian government to review renewable energy generation.
Panel member Dick Warbuton, a former chairman of Caltex and a known sceptic of climate change, was responsible for alienating representative of renewable energy in meeting the country’s RET or renewable energy target. Investment in renewable energy declined sharply last year after the federal election. Despite these setbacks, the Clean Energy Finance Corporation is set to provide an initial cornerstone investment of around $80 million.
Meeting the Needs of Direct Investors of Clean Energy Finance Corporation
This investment will be in the form of a wholesale infrastructure platform in renewable energy. The corporation has, in fact, entered into a partnership with CFSGAM, or Colonial First State Global Asset Management, to establish a platform for the country’s first ever unlisted direct infrastructure geared toward institutional investment. A further investment within the next three to five years of between $300 and $500 million will be raised by CFSGAM.
Said platform, according to the Clean Energy Finance Corporation, will begin investing in mature operating assets that use eligible technologies already established as well as developments in green field eligible for construction. The platform will help meet the needs of direct investors and members of the superannuation fund who are interested in investments that are socially responsible and financially robust at the same time.
According to Clean Energy Finance Corporation’s CEO Oliver Yates, these superannuation fund members want to take the lead in recognizing the future potential and possible growth strength of new energy efficient sectors in technology. New investment sources will help unlock fresh capital for the renewable energy markets and expand this sector’s investor base.
Based on a New Energy Finance report from Bloomberg, Australian investment in renewable energy decreased from roughly $2.7 billion last year to $40 million during the first half of 2014. This change in the renewable energy target, still according to Bloomberg, can be “devastating” for the country’s clean energy efforts.
The cornerstone investment for a unique platform can significantly reverse the direction to which renewable energy efforts may be heading through the achievement of investment objectives such as the generation of renewable energy investments of up to $35 billion. Funding for an expanded 3.1MW Uterne station using solar power in Alice Springs has been announced by the Clean Energy Finance Corporation. This positivism is in direct contrast to the pessimistic stand that the Australian government seems to have taken.
Adopting the use of renewable sources of energy for the Clean Energy Finance Corporation are a lower cost alternative to various types of fossil fuel and the usage of these sources considerably reduce electricity’s wholesale prices. Although some investors have shown concern about Australia’s renewable energy future because of the current political environment, CFSGAM Head of Direct Infrastructure Perry Clausen is certain that there remain several “attractive” options in direct investments for infrastructures that utilise low carbon energy.