The Federal Government has announced the creation of a new $1 billion fund to invest in green technology. As part of the new Low Emissions Technology Commercialisation Fund, Prime Minister Scott Morrison’s Government has committed $500 million, with the other half expected to be matched by private investment.
Development of emerging tech
The Clean Energy Finance Corporation (CEFC) will administer the new fund, which will focus on developing emerging technologies that private finance would otherwise assess as too risky.
Energy Minister Angus Taylor emphasised the importance of funding a diverse array of technology, telling ABC radio on Wednesday, “We need every horse in the race. (Emissions reduction) is a difficult goal for the world, it’s a difficult goal for Australia, you can’t rule things out.”
The net-zero plan Mr Morrison delivered to COP26 earlier this month heavily relied upon developing new technologies. Emerging and fledgling technology will be responsible for 15 per cent of Australia’s total reduction in emissions by 2050.
Mr Morrison continues to defend the Federal Government’s “tech, not taxes” approach to climate action. The six priority technologies are:
- Changes to livestock feed to reduce methane emissions
- Efficient glass coatings on solar panels
- Soil carbon measurement methods
- Improved software
- Lighter and more efficient batteries
- Carbon dioxide capture and storage underground.
“Australia can become a world leader in creating low-emissions technology that is both affordable and scalable, helping get emissions down while creating jobs,” Mr Morrison said in a statement.
In response to the new fund, digital innovation and technology peak body, Australian Information Industry Association(AIIA) ’s CEO, Ron Gauci, said, “The AIIA applauds the Morrison Government on continuing to invest in technology as a means to resolve the key issues impacting Australia and the world.
“The AIIA has, for some time, been promoting the opportunities that Australian technology creates for providing growth and real-world solutions. At the heart of every problem we currently face, technology, whether it be BioTech, AgriTech or supply chain logistics, to name a few or many, is a key part of the solution. We encourage further investment in research and commercialisation to realise the benefits for our country.”
What is the CEFC?
The CEFC is an Australian Government-owned Green Bank established to facilitate finance into Australia’s green energy sector. The CEFC is responsible for investing $10 billion across the economy on behalf of the Australian government. Unlike other CEFC funds, which are loan driven, the new low-emissions fund will be equity-driven.
This type of funding will fill a gap in Australia’s tech start-up landscape. “There’s a gap in the market, it’s difficult for (start-ups) to get funding, and there’s a role for government to play alongside the private sector,” Mr Taylor said.
The Coalition plans to introduce the legislation to parliament before the next election, due before May 2022. To create the new fund, the proposed legislation will enable the CEFC to invest in carbon capture and storage, which is one of the six priority technologies the government is relying on to help achieve net-zero.
Carbon capture and storage has been criticised by many, including mining magnate Andrew “Twiggy” and the Federal Opposition, as unproven and ineffective technology.
Electric vehicle fund
Alongside the Low Emissions Technology Commercialisation Fund, the Federal Government announced $250 million in funding as part of the Future Fuels Fund. The strategy is expected to result in more than $500 million of combined private and public co-investment directed into the uptake of electric vehicles in Australia.
The Federal Government said the future Fuels and Vehicles Strategy would contribute to Australia’s Long Term Emissions Reduction Plan by accelerating access to electric vehicles and other low emission transport technologies.
Mr Taylor said, “Like we saw with our world-leading rooftop solar uptake, we know that when new technologies reach price parity, Australians rapidly adopt them. We will take these lessons from solar integration into our reform work to ensure our grid is ‘EV ready’ to keep the lights on and bills affordable for everyone.
“Voluntary adoption of electric vehicles is the right pathway for reducing transport emissions over the long term. Stringent standards, bans or regressive taxes will limit choice and increase the upfront costs of cars for Australians.”
The opposition’s position
The Morrison Government’s tech-based approach to climate change has drawn criticism and allegations of hypocrisy. Opposition climate spokesman Chris Bowen said Labor would examine the new funding policy but regarded the policy primarily as “spin”.
Mr Bowen told ABC television, “We have opposed a diversion of renewable energy funding to carbon capture and storage.”
During the 2019 election campaign, Mr Morrison attacked Labor’s electric vehicle policy, saying that the uptake of electric vehicles would mean “the end of the weekend”. Similarly, the coalition attempted to terminate the CEFC, which it now relies upon, previously dubbing it the “Bob Brown Bank”.
The Federal Government has not only faced criticism from the opposition but also from within the LNP. Green-tech remains an ongoing issue within the party. Queensland Nationals senator Matt Canavan told Nine Network that the fund was “a billion dollars for a bunch of rent-seekers who are talking about fake jobs. It seems like a big waste of money to me.”
Mr Canavan is an outspoken critic of green initiatives saying, “We need to look at real jobs, not just green jobs.”
Read more:OneVenture to manage $30 million in Victorian startup funding
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