Eco Innovator November 2011
Get in Quick and Big for
Clean Energy Funding
The passage through the lower
house of the Federal Government's Clean Energy legislation and price on
carbon emissions, and the legislation's expected passage this month through
the Senate, is the best news clean energy entrepreneurs have received
for some time.
It comes with progress on the
establishment of the $10 billion Clean Energy Finance Corporation (CEFC),
with the Government appointing an expert panel to advise on the design
of the Corporation, and the introduction of legislation to create the
$3.2 billion Australian Renewable Energy Agency (ARENA).
CEFC and ARENA will provide
massive stimulus to clean energy innovation and commercialization on a
scale not seen before in Australia. In Australia's desert of commercialization
funding, a few oases will suddenly appear. If done well and all goes well,
clean energy innovators will see their chances of securing funding increase
dramatically. They may also get to operate within policy settings that
are conducive to commercialization.
But the key phrase here is
"if all goes well". Unfortunately the Federal Opposition under
Tony Abbott continues its ferocious opposition to the Government's temporary
"carbon tax" with an overly dramatic pledge "in blood"
that it will repeal it at the first opportunity.
If that wasn't enough to spoil
the party, the Coalition also said it would abolish the Clean Energy Finance
Corporation. And just to grind its heel into entrepreneurs, innovators
and everyone else involved in clean energy, it added that where possible
it would reverse any funding commitments made by the CEFC.
Boy! They want to take away
the lot, the whole $10 billion or as much of it as possible. That's a
big stick. And they said it without offering a single carrot in return.
Nothing to make up for the loss or to help emerging clean energy products
into the market.
It is the same ruthless threat
made to the carbon credits market when the Clean Energy legislation passed
the lower house. Mr Abbott said emitters should not buy future carbon
credits as a Coalition government would reverse the legislation and where
possible do so without compensation.
These threats are intended
to scare good people into doing nothing so that the price on carbon and
the funding by the CEFC do not happen or get off to a slow start and so
are easier to unwind.
For normal people it is hard
to fathom such ruthlessness, such rabid support for fossil fuel polluters,
such brusque lack of support for clean energy producers and clean energy
What should innovators do?
Should they give in to the threats, reject them outright and defiantly,
or something in between?
The bottom line is that capital
hungry entrepreneurs either find capital or die an entrepreneurial death.
With $10 billion, the CEFC is for unlisted companies the only big oasis
in the desert. So the choice is clear. It is better for Tony Abbott to
die a political death than for innovators to die an entrepreneurial death.
Rather than give in to the
Coalition's threats, the best response for innovators is to get in early
and apply for and get as much support from the Clean Energy Finance Corporation
as they need or can.
Hopefully Mr Abbott will not
get a chance to close the well. But even if he does, getting in early
will make it that much harder for him to do it.
And hopefully, in the meantime,
innovators and entrepreneurs will have had enough of a drink to get them
to the next water hole. For unlisted companies especially, such is the
desert of commercialization in modern Australia.