APRA warns company directors about personal liability on climate change. Politicians should also take note.
APRA, the Australian Prudential Regulation Authority, has warned company directors and other decision-makers that they may be held personally responsible for dumb investment decisions in relation to a transition to a low emissions economy. If a coal-fired power station with or without CCS becomes a stranded asset, whoever approved the funds could be in the gun.
So even if the government changes the legislation to allow CEFC to lend to new coal-powered electricity generators, responsibility still lies with the directors of the Clean Energy Finance Corporation (CEFC). Continue reading APRA warns company directors about personal liability on climate change
If you shake hands with Malcolm Turnbull, you best count your fingers to see whether they are still there.
In short, he’s “keeping” ARENA, except that it has no funds, its grant function will be terminated and organisationally it will be absorbed into the CEFC. He starting a new fund, called the Clean Energy Innovation Fund, a subsidiary fund of the CEFC, to lend out to bankable ‘innovative’ ventures, but the funding is less than is already there, and will be dribbled out at the princely rate of $100 million per year for the next 10 years so as “not to overwhelm the market.”
In other words, pretend you are brave and forward-looking, but don’t do anything that might disrupt coal’s predominance any time soon. Continue reading Turnbull’s clean energy stunt
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. Continue reading Saving the CEFC
This article from Climate Spectator tells us that shutting down the Clean Energy Finance Corporation (CEFC) will actually cost the government $200 million each year in lost revenues.
The article refers to an article (by Laura Tingle) in the AFR. Apparently my $3 per day subscription doesn’t entitle me to see the article online – the first time I’ve encountered this problem.
In the dead tree version we are told that the CEFC is making 7% on funds invested, as against their benchmark of 3%, being the five-year bond rate. Other than being a good Labor idea, I think the Government’s objection may be that the CEFC adds to gross debt. The fact that it adds nothing to net debt is apparently irrelevant.
The dividend stream more than covers the cost of administration. The Direct Action alternative is to pay public servants to hand out taxpayers’ money without a return.
Each dollar spent by the CEFC leverages $2.90 in private capital expenditure. So far over $500 has been spent leveraging $1.55 billion of private capital investment.
Apparently the CEFC operates in a niche that would not happen without it.
It has been able to do deals that are too small, too complicated, or not previously done in Australia. In other words, deals that bankers can’t get past their own credit committees which prefer easier propositions.
Perhaps the CEFC’s real crime is to offend Big Coal.