$10 billion energy fund passes lower house

$10 billion energy fund passes lower house

AAPUpdated May 30, 2012, 8:01 pm

The federal government has pushed legislation through the lower house to set up a $10 billion green investment bank for clean energy projects.

After parliamentary debate on Tuesday and Wednesday the government won a vote to pass a legislative package to set up the Clean Energy Finance Corporation (CEFC) just before the House of Representatives adjourned.

Climate Change Minister Greg Combet said some contributions by coalition MPs were “misleading and misrepresentative” of the legislation.

They had spoken “nonsense,” Mr Combet told parliament.

Coalition MPs argued the CEFC was based on accounting trickery, with the government calling the fund a commercial venture which wouldn’t push the budget into deficit because it didn’t have to be included.

The government will invest $2 billion a year over five years from 2013-14 in the corporation, which will link private companies in funding large-scale clean energy projects.

It says the corporation will become self-supporting.

A committee report, tabled on Wednesday, recommended the parliament pass the legislation but coalition members lodged a dissenting report saying the CEFC presented an unacceptable risk to taxpayers by underwriting a significant amount of commercialisation that could fail.

The minority members of the committee argued against the laws being passed.

The corporation will support renewable and low-emission energy projects through loans, guarantees and equity investments from 2013/14, as part of the government’s carbon price package.

Treasury has estimated the CEFC could lose 7.5 per cent of the capital it invests on unsuccessful projects, but overall it will aim to make a profit of four per cent a year.

Labor MP Stephen Jones said the corporation was needed because of a “market failure” in clean energy investment.

The Clean Energy Finance Corporation Bill 2012 and subsequent bills now move to the Senate.

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