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New Emerging Renewables Program Funding Proposed, Commercialisation Strategy Announced: Australia

April 5, 2011

Today, the Australian Centre for Renewable Energy (ACRE) – Australia’s peak renewable energy government commercialisation agency – published their ‘Strategic Directions’ paper, in which they specify the approach, priorities, technology targets, and funding allocation for new technology commercialisation and development.

The Minister for Resources and Energy has said he will consider their position.

ACRE proposes to focus on development and demonstration of targeted technologies which offer the promise of being ‘best value’ investments ‘with value measured primarily by the potential economic benefits from lowering the cost and increasing the supply of renewable energy in Australia over the long term’.  

A real plus to the approach they take is a preferred position to match funding support to demand, recognising that the funding supply approach taken by technology or development stage support mechanisms leaves many prospective market opportunities in the lurch.  They propose to do this through a new integrated technology funding initiative called the ‘Emerging Renewables Program’.

ACRE proposes to support those initiatives which either have globally-applicable opportunities, or exploit avaiable resources in Australia. 

The proposed key operating principles of the Emerging Renewables Program are:

 
1. Lowering the cost of renewable energy supply in Australia is a key consideration in determining suitability for funding.
 2. A two-stage process will be followed, i.e. EOI followed by invitations to submit full proposals.
3. ACRE will be open for business on a semi-continuous basis.
4. Applicants will nominate the stage in the innovation chain to which they wish ACRE funding be applied (e.g. engineering design/development, pilot-scale demonstration, research to tackle a major technical problem encountered).
5. Progress from an EOI to an invitation to apply for funding is not guaranteed and any such invitation, if issued, may take considerable time if project development costs are large and/or ACRE’s available funds are limited.
6. Evidence of global competitiveness of technologies proposed for ACRE funding will be required.
7. Budgeting and funding rules for proposals will be developed, including proposing the option of non-grant funding mechanisms.
8. Applicants must provide evidence that they have a plan including funding sources to progress their technologies to the next stage in the innovation chain and/or to commercialisation (ACRE reserves the right to undertake due diligence with technology providers and financial backers).
9. Risk assessments for each project will be required.
10.Successful projects will be subject to ongoing review to ensure they continue to meet ACRE’s objective.
In terms of technologies:

For Solar, ACRE recognises the range and breadth of other government technology support mechanisms and measures.  In a review of solar technology status, it concludes that solar energy technologies ‘will take some years to become viable even under a carbon price‘. 

This is an interesting conclusion in light of the view of many that solar will very soon reach grid parity in Australia due to increased sophistication and availability of time-of-use billing, installed cost reductions, and increases in electricity costs. It proposes to focus on enabling technologies including energy storage.

For Geothermal, ACRE proposes to focus on supporting resource discovery and proving.  It has commissioned a study to further understand sector constraints and needs.

ACRE does not propose significant support for either wind or hydropower.  For hydro, it recognises that ‘future growth in Australia’s hydroelectricity generation will be underpinned by the development of small-scale facilities and the refurbishment of current large-scale hydro plants’.

For Ocean/Wave/Tidal technologies, ACRE proposes supporting conducive regulatory regimes and ‘may consider’ supporting specific pilot scale projects.

For Biopower, ACRE will support ‘R&D and pilot projects for second-generation biofuels projects (including algae), and biopower and bioheat projects’.  Other areas of suport include hybrid technology pilots and enabling technologies and systems, including ‘selected technology concepts with breakthrough potential’.

The ACRE Strategic Directions paper makes good sense.  The difficulty is that the organisation is effectively attempting to generate a commercialisation strategy within an energy policy vacuum.  We hope that ACREs vision is integrated within a more holistic federal government energy strategy, which urgently needs clarification through issuance of the long-promised and overdue Energy White Paper.

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4 Comments leave one →
  1. July 22, 2011 10:08 am

    Let’s build renewable energy parks with commercially proven technology and ARCE’s support.
    It’s the fastest way to develop an industry for Australia by Australians.
    Let’s develop projects from bricks and mortar today and not place all our tax payers money in pipe dreams of a future!

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