The Morrison government has launched a third attempt to change the Australian Renewable Energy Agency (Arena) to allow it to fund a broader range of technologies, including some using fossil fuels.
The Senate has twice in the past year used a disallowance motion to block new regulations introduced by the energy and emissions reduction minister, Angus Taylor, to expand Arena’s remit to include backing technologies such as hydrogen made with gas and carbon capture and storage (CCS).
The most recent disallowance motion passed last Monday. It was moved by the outgoing Liberal senator Concetta Fierravanti-Wells in her role as the chair of the standing committee for the scrutiny of delegated legislation.
Fierravanti-Wells told the Senate the expansion of Arena’s remit was not consistent with what the parliament envisaged when it passed the laws creating the renewable energy agency. Labor, Greens and some crossbenchers opposed the expansion on the grounds a renewable energy agency should not fund fossil fuel developments.
On Friday, with parliament having risen until after the upcoming election, Taylor released a new set of regulations to govern Arena. It will apply unless blocked by the Senate of the next parliament.
Senate estimates heard on Monday that the new regulations would allow Arena to fund a larger range of technologies than the version disallowed last week.
That version was explicitly tied to priority areas under the Coalition’s low-emissions technology roadmap. The latest version says Arena will be able to fund clean energy technologies as defined by the board of a separate government agency, the Clean Energy Finance Corporation (CEFC).
This created some confusion as CEFC, which is sometimes described as the national “green bank”, is banned from funding CCS and nuclear projects.
Estimates heard Arena would not be subject to the same ban. Officials said nuclear power faced other prohibitions, but the new regulations could allow Arena to fund developments that use CCS such as the development of “blue” hydrogen made with gas. They could also let the agency back low-emissions transport, cement, steel and aluminium developments and carbon capture and utilisation projects.
Through a spokesperson, Taylor said the government was committed to ensuring its agencies could “support the full range of technologies that will reduce emissions”.
“These changes are supported by a broad cross section of peak bodies and industry groups,” the spokesperson said.
“In this term of parliament, Labor has joined with the Greens to oppose more funding for these agencies and a broader technology mandate. They’ve gone against the advice of expert bodies like the International Energy Agency and Intergovernmental Panel on Climate Change, who call for an ‘all of the above’ approach to reducing emissions.”
Labor’s climate change and energy spokesperson, Chris Bowen, criticised Taylor’s attempt to redraw the new regulations. “The only thing that will stop this bloke’s attacks on cheaper and cleaner energy is a change of government,” he said.
The Greens leader, Adam Bandt, said the new regulation was a blatant attempt to “undermine the renewable energy agency”.
“These regulations won’t last,” he said. “Sneakily acting after parliament has risen might buy the Liberals a few weeks, but we’ve defeated them before and – after we kick the Liberals out at the election – we will defeat them again.”
Estimates heard Arena could already fund a range of technologies beyond solar and wind power before the change. They included bioenergy, battery storage, hydro power, pumped hydro, demand storage, green hydrogen made using renewable energy, geothermal and ocean energy.
Referring to previously proposed regulations, industry group the Smart Energy Council has previously said it would launch legal action to challenge the broadening of Arena’s remit if it was not disallowed in the Senate.
