Saving the CEFC

Sophie Vorrath at RenewEconomy reports that both Senators Xenephon and Madigan spoke against the bill to abolish the Clean Energy Finance Corporation (CEFC). The Abbott government may not be able to complete their destructive war against renewable energy, even with the new senate next July. My understanding is that they need six votes from the cross benches. These may be hard to find.

However, Vorrath gave prize for best and most impassioned Senate speech in defence of the CEFC to WA Greens Senator Scott Ludlam, who repeatedly pointed out the lack of Coalition Senate representatives to argue their side of the debate. I’ve republished here her selection of highlights in plain text rather than italics.

ludlam“What kind of government takes stock of the collective years of experience of the public sector, bolstered with the kind of private sector expertise that we see within the Clean Energy Finance Corporation, and immediately embarks on a process of mass sackings and redundancies?

We know who has set the template: people like Colin Barnett and Campbell Newman, a yawning vacuum of imagination, yesterday’s men who have somehow deluded themselves into thinking that something as powerful and dangerous as the global climate system can be subordinated for momentary political advantage.

So this is your big moment. This is the moment where you propose to dismantle the Clean Energy Finance Corporation, which will cost the budget something in the order of $200 million a year and crash the renewable energy sector in Australia just as it is finding its strength.

What I do not understand is why all of you on that side of the chamber are suddenly looking so shaky. All the bluster has gone out of you. The Liberals put up one speaker yesterday, Senator Abetz, who quickly ran through the same tired talking points that he has been reciting for three years and then sat down.

The rest of the Liberal Party have stayed in their offices and the Nationals have not showed up at all at your moment of triumph, and that is what I am struggling to understand.

In one year, the Clean Energy Finance Corporation has already achieved nearly four million tonnes of carbon emissions abatement—more than half of our annual target. For all of the strange financial illiteracy on display on the other side—people calling it a hedge fund or Bob Brown’s bank—this is not a grants organisation and this is not writing out cheques that the Commonwealth does not get back. It is making money for the taxpayer of approximately $2.40 for every tonne of carbon abated.

Who knew that you could actually make a financial return to the taxpayer at the same time as eliminating greenhouse gas emissions and creating jobs in the sunrise industries of the 21st century? It is generating a 7.3 per cent return on investment, which is nearly four per cent above the standard government bond rate. It is an entity that is filling the budget vacuum that has been left by your proposals to abolish the carbon price and the mining tax and it attracts just under $3 from the private sector for every dollar that it invests.

How awkward for you to discover in a committee hearing that this entity that you propose to wreck is actually making a financial return to the taxpayer. How exactly does that square with your budget emergency and your desperation to attack the Public Service, cut education spending, cut health spending and abolish public transport funding because you are in such a desperate budget emergency? Yet, at the same time, you line up to kick apart an entity that is making, and intends to make, a $200 million return on the taxpayers’ investment.

The CEFC, as others have noted, is one of 14 co-financing institutions around the world that are catalysing and creating huge investment in renewable energy. Bloomberg New Energy Finance believe the investment in one year is upwards of $58 billion in renewable energy and $109 billion in energy efficiency globally. At last we have the Australian parliament and the Australian government doing its bit. As the empty government benches show, maybe you are not quite as proud of this as you might have displayed during the people’s revolt.

I have had a bit to do with the Clean Energy Finance Corporation in Western Australia. They briefed a meeting, ironically enough, of your stakeholders—the mining industry—in Kalgoorlie earlier this year to explain how the mechanism would work. They said: ‘We are not a grants organisation. We are not here to write out cheques that we won’t see again. We are here to get the industry on its feet.’ And the first people at the front of the queue will be the gold and nickel producers in the goldfields who are looking for some kind of hedge against skyrocketing gas and diesel prices. They are the ones who will build the first iteration of this technology in Western Australia. Not because they are driven by the climate imperative—they are driven by commercial imperatives and they are looking to get technology into the ground that can protect them from rising energy costs.”

Thus spake Scott Ludlam. His full speech is here. Go here for our earlier post.

4 thoughts on “Saving the CEFC”

  1. Greg Hunt’s direct action proposal looks like wasting taxpayers money on paying polluters to do things they were going to do anyway. The GEFC process looks like a form of direct action that is more likely to get value for money for projects that don’t quite fit into the larger programs used to drive things like investment in renewables.
    The irony in climate politics at the moment is that the coalition really needs organizations like the GEFC to make sensible use of direct action. It also needs the carbon tax to provide the revenue scheme needed to pay for some of their direct action.

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