Following a long period of uncertainty, the Australian Government announced yesterday that it will no longer seek to abolish the Clean Energy Finance Corporation (CEFC). The Abbott government’s attempts to abolish the corporation were blocked by the Senate. Malcolm Turnbull’s approach to the CEFC has been more positive and he has now confirmed that the Abbot government policy will be abandoned.
Not only has the CEFC been spared, but it will now have a greater focus on innovation through the establishment of a new $1 billion fund to be jointly managed by the CEFC and the Australian Renewable Energy Agency (an agency that was also to have been abolished under the Abbott government policy). The Clean Energy Innovation Fund (CEIF), as it will be known, is intended to promote innovation and entrepreneurial business activity in the clean energy sector by offering both debt and equity for clean energy projects, energy efficiency and low emissions solutions.
It is anticipated that the Government will set a new investment mandate for the CEFC to accommodate the creation of the CEIF and that the new mandate will give the CEFC the opportunity to assist with more innovative and higher-risk projects and investments.
The CEFC has to date proven itself to be an innovator in driving energy efficient projects. This positive announcement will provide the certainty needed for the CEFC to fulfil its role of reducing impediments to funding in the clean energy sector and, beyond that, to use its existing resources and expertise to assist innovative entrepreneurial clean energy companies to contribute to our economy while playing a positive role in reducing emissions.