ABC News reported the fate of future funding for the Australian Renewable Energy Agency or ARENA now depends firmly with the Federal Opposition, this, after Nick Xenophon Team or NXT confirmed it would block the Government’s proposed budget cut.
The 1.3 billion cuts are contained in the Government’s omnibus savings bill, which is currently before the parliament.
Senator Xenophon said if the bill was passed it would devastate the renewable energy industry in the country. The government wants to cut ARENA’s funding as part of plans to set up a Clean Energy Innovation fund that would hand out loans instead of direct grants. The senator said while his team would not support the funding cut, there was scope to change the way ARENA worked.
He stated that there should be a change in the funding mechanism to ensure that if a renewable energy technology has commercial success, then the grant should be repaid and there should be the ability for ARENA to take an equity in that project so it can take advantage of the benefits. He also said that he will ask the Labor Party to support such an amendment when the bill reaches the Senate.
The NXT’s decision to block the grant cut puts more pressure on Labor to decide how it will vote. It included the $1.3 billion cut in its election costings, but it was partially offset by $300 million of other investment as part of a broader climate policy.
The Greens energy spokesperson, Adam Bandt was cautious about Senator Xenophon’s proposed amendment to allow ARENA to recoup funds from successful projects. He added that if ARENA grants fund projects and result to commercial success, then the public’s already going to get dividends from that. Jobs will be created and taxes will come from people being at work which will going to deliver a return to the government.
But Bandt said the Greens would consider the idea if it was necessary to maintain ARENA’s funding. The Clean Energy Council also said that they will support the changes on the way the agency works.
Click here to read the full story on ABC News
Featured Image Credit: Lance Cheung