Taylor adds carbon capture and storage to clean energy agencys plans

Australian clean energy investment arm is including for the first time a commitment to fund carbon capture and storage projects, following the federal government’s controversial change to the agency’s remit in August.

Energy and Emissions Reduction Minister Angus Taylor passed new regulations through Parliament to expand ARENA’s investment mandate to include carbon capture and storage and more uses of gas power.

Energy and Emissions Reduction Minister Angus Taylor passed new regulations through Parliament to expand ARENA’s investment mandate.Credit:Alex Ellinghausen.

The former Labor government established ARENA in 2012 to invest in renewable energy technology to make it cost-competitive with established technologies like coal and gas.

Mr Taylor will launch ARENA’s new investment plan on Thursday. He said the remit needed expansion beyond renewable energy to develop emissions reduction technology across more sectors of the economy.

“There is no silver bullet, and restricting ourselves from exploring opportunities for innovation will limit our â€" and the world’s â€" prospects of success,” he said.

“That’s why I recently enacted regulations to expand ARENA’s mandate, enabling the agency to work across new sectors and technologies.”

The government’s emissions reduction plans centre on a technology road map, which aims to work with the private sector to stimulate investment in lower emissions technologies that are selected for their commercial prospects.

There are five priority technologies in the road map: soil carbon sequestration on farmland, green steel and aluminium, energy storage to back up intermittent supply from renewables, hydrogen produced from gas or renewables, and carbon capture and capture and storage â€" which could be attached to either manufacturing plants or coal and gas power stations to capture their emissions and store them underground.

ARENA selects projects to invest in on merit, and the agency’s chief executive Darren Miller said the agency’s new investment plan, released this week, was “critical” to decarbonise the economy.

“To get to net zero, we need to invest today in the technologies that are going to transform our energy system,” Mr Miller said.

He said ARENA would pursue projects across the technology road map and “we will be looking to scale up [carbon capture and storage] and reduce the cost of soil carbon”.

“As these are new areas for ARENA, we’ll be consulting with industry and researchers to develop our approach to these technologies,” he said.

“We need to utilise Australia’s abundant sun and wind resources to produce, use and supply renewable energy. We need to optimise this transition through energy storage, large-scale grid integration, flexible demand and further reducing the cost of solar and wind.”

Labor and the Greens opposed the regulation change in the Senate but failed by one vote to block it.

The Smart Energy Council, which represents renewable energy developers, has raised the prospect of a legal challenge to Mr Taylor’s changes to ARENA.

Labor climate change and energy spokesman Chris Bowen said he would work to gain the numbers to block the change and have another go in the future.

ARENA has delivered $1.8 billion in funding to 600 renewable energy projects. ARENA’s funding was renewed with $1.62 billion over the next 10 years.

The Greens and environmental groups oppose funding for carbon capture and storage because it would direct taxpayer dollars to fossil fuel companies.

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Mike Foley is the climate and energy correspondent for The Age and The Sydney Morning Herald.Connect via Twitter or email.

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