MELBOURNE, Sept 13 Australia is to cut A$500
million ($375.50 million) in funding from its renewable energy
agency as it strives to plug a $6 billion budget shortfall, a
smaller cut than initially planned.
The Australian Renewable Energy Agency (ARENA) will get
A$800 million in funding over the next five years.
Under an earlier government plan, the agency's funding was
due to be cut by A$1.3 billion but the cut was softened after
negotiations with the opposition.
"As part of the agreement we will restore $800m of ARENA's
funding over five years and will work with the agency on its
forward work program," Minister of Energy and Environment Josh
Frydenberg said in a statement.
The new funds will be in addition to funding ARENA has in
place to complete about 200 projects and to fund several
large-scale solar projects announced last week.
The government has pledged to support a dozen large-scale
solar projects worth A$1 billion ($770 million) as it looks to
boost the use of clean energy in the coal-rich country, which is
one of the world's biggest carbon emitters per head.
Australia wants to double its large-scale renewable energy
generation to 33,000 gigawatt hours by 2020, which means solar,
wind and hydro-electricity would have to make up nearly a
quarter of power generation by then.
Clean Energy Council Chief Executive Kane Thornton said the
funding cuts would slow the rate of development and innovation
in new, clean energy technologies.
As evidence of the improving competitiveness, ARENA said
last week early large-scale solar plants needed A$1.60 per watt
in government funding, but funding for the 12 new projects has
dropped to just 19 cents per watt in just three years.
"We've seen a lot of projects getting up on their (ARENA's)
funding, and lot of projects reducing costs," consultant Peter
Munns, who heads British infrastructure firm John Laing's Asia
Pacific renewables division, told Reuters.
"The cuts probably reflect the fact they have done a good
job in terms of pushing new technologies into the market. They
may be getting to a point where ARENA needs less funding than it
($1 = 1.3316 Australian dollars)
(Reporting by Melanie Burton; Editing by Robert Birsel)