Last week the Australian Renewable Energy Agency (ARENA) announced its funding priorities for the 2015/2016 financial year alongside its new streamlined programme structure.

Under ARENA’s July 2015 Investment Plan its priorities for new investments are projects that focus on:

  • integrating renewables and grids;
  • renewables for industrial processes;
  • off-grid areas;
  • fringe-of-grid and network-constrained areas; and
  • large-scale solar photovoltaics.

Although ARENA has identified these five areas as priorities, the Investment Plan states that exceptional proposals will be considered for funding even if they fall outside the defined investment priorities.

ARENA’S FUNDING PRIORITIES

ARENA’s funding priorities are grouped into three broad investment themes.

Theme one: Addressing barriers to the long-term uptake of renewables

Under this theme ARENA will put funding towards integrating renewable energy with the grid and improving the efficiency of our existing electricity distribution system. Specifically, ARENA wants to invest in projects that improve electricity supply chain efficiency, integrate renewable energy into the low-voltage network and facilitate knowledge sharing between all parties in the electricity supply chain.

Theme two: Helping renewable energy technologies meet energy users’ needs

Under theme two ARENA will be investing in projects that apply renewable energy technologies to a wider range of sectors. ARENA aims to promote renewable energy as a viable alternative within industrial processes, for off-grid and fringe-of-grid services and for residential and commercial buildings. ARENA has also pledged $80-100 million for up to 200MW of large-scale solar photovoltaics via a competitive tender process with an aim to make large-scale solar as commercially competitive as wind power generation.

Theme three: Advancing the commercial development of renewable energy and enabling technologies

As stated in ARENA’s General Funding Strategy, ARENA will not fund activities that are commercially viable without ARENA support. This view is reflected in the third theme of ARENA’s 2015 Investment Plan which distributes funding to renewable energy technologies based on where they sit on the research to commercialisation spectrum.

ARENA will be funding research and development activities in geothermal energy and solar thermal renewable energy projects. It will focus on funding pilot and demonstration activities for bioenergy technologies, biofuels, solar thermal energy technologies and energy storage. Its strategy for investment in marine power is tightly linked to commercialisation of marine energy technologies and knowledge sharing projects. Investment in solar is limited to the innovative applications in line with theme two.

Notably, ARENA’s Investment Plan states that it does not intend to invest in hydro power or renewable fossil fuel hybrid generation, and its investment in wind power will be limited to reducing back-end grid and plant costs and overcoming ‘social licence’ challenges.

NEW PROGRAMME STRUCTURE

ARENA has merged its five funding programmes into two streams. Previously the ARENA funding structure had specialised programmes for regional renewables, community energy projects and renewable energy advocacy. These programmes have been merged into two streams: the Research and Development Programme (for projects in the R&D stage), and the Advancing Renewables Programme (for projects in the pilot, demonstration or pre-commercialisation stages). Through these two programmes, projects will be funded according to where they sit on the commercialisation timeline rather than through more specific funding streams.