The former chair of the Australian Renewable Energy Agency says new regulations to expand ARENA’s remit are a thinly veiled attempt to divert funding to fossil fuel-linked projects.

The changes published by the federal government this week will enable ARENA to fund what it says are “next generation” clean energy technologies like “clean” hydrogen and carbon capture.

ARENA will be able finance “low emissions” technologies and technologies that could “reasonably be expected” to control, reduce or prevent greenhouse gas emissions “to a material extent“, the regulations say.

Greg Bourne, former ARENA chair and former president of BP Australasia turned Climate Council spokesman, says the government shouldn’t be spending money on “unnecessary and unproven technologies that prop up fossil fuels”.

“To reduce emissions at the scale and speed that is required to avoid catastrophic climate change, and to shape an energy system that is reliable, affordable and clean, we should be phasing out fossil fuels and transitioning to 100 per cent renewable energy,” he told Government News.

ARENA says the changes mean it will be able to support technologies contained in the Low Emissions Technology Statement (LETS) which also include energy storage, low carbon aluminium and steel production, and soil carbon.

ARENA will also be able to fund the Future Fuels Fund, Industrial Energy Transformation Studies Program, Regional Australia Microgrids Pilot Program and the Freight Energy Productivity Program.

It comes as the government announced $600 million to build a gas-fired power station in the NSW Hunter region in the federal budget.

Re-focused priorities

ARENA CEO Darren Miller says the agency’s priorities are now focused on accelerating hydrogen uptake and helping industry reduce emissions.

As technologies such as solar and wind mature, we must be able to move forward and support the next generation of clean energy technologies.

Darren Miller

“As technologies such as solar and wind mature, we must be able to move forward and support the next generation of clean energy technologies,” he said.

“ARENA’s focus has evolved from supporting pure renewable energy generation technologies to assisting with the integration of these technologies to support the operation of the system with ever increasing shares of variable renewable energy.”

Boost for emmissions targets

David Byers, CEO of the CO2CRC said the new regulations would allow ARENA to play a key role in driving down the cost of low emission technologies.

“This will encourage the development, application and scaling up of technologies that can strengthen industry and create jobs while reducing CO2 emissions,” he said in a statement.

He said with some two thirds of Australia’s emissions coming from outside the power generation sector technologies like carbon capture were vital to achieving long-term emisssions reduction goals.

“Australia is well positioned to be at the forefront of the global scale-up of CCUS technologies,” he said.

“It has ready access to the latest CCUS technologies and expertise, some of the world’s best deep sedimentary basins in which to store carbon dioxide, an internationally recognised resources industry, and globally renowned researchers.”

Since being established in 2012 to finance renewable energy projects, ARENA has supported 586 projects with $1.7 billion worth of grants.

The 2021-22 budget will invest $539.2 million in new hydrogen and carbon capture, use and storage (CCS/CCUS) projects.

It provides $1.6 billion over ten years from 2021‑22 to incentivise private investment in technologies identified in the LETS and the Technology Investment Roadmap.