Federal Budget 2011: key announcements for climate policy, energy and carbon

11 May 2011Archived News Climate Change Matters

In this year's Federal Budget, the Government has included changes to climate change programs aimed at better aligning them with the objective of introducing a carbon price. Below are the key, relevant excerpts from the Budget Papers (Click to access), that relate to climate change policy, energy and carbon management.

Greenhouse and energy reporting - additional funding

The Government will provide $20.2 million over four years for the Department of Climate Change and Energy Efficiency's greenhouse and energy reporting function. The funding will support administration of the National Greenhouse and Energy Reporting Act 2007 and regulatory and compliance activities.

The accurate reporting of greenhouse gas emissions is a key foundation to the establishment of a carbon price.

Renewables

National Solar Schools Program - reduction in funding
The Government will reduce funding for the National Solar Schools Program by $156.4 million and bring forward the program's closure by two years to 30 June 2013. Funding of $49.8 million will remain available to eligible schools through two competitive funding rounds in 2011 12 and 2012 13, with an increased emphasis on funding schools in low socio-economic and remote areas.

Renewable Energy Target — reduction of the solar credits multiplier
The Government will bring forward by one year, to 1 July 2013, the scheduled phase out of the solar credits multiplier under the Renewable Energy Target. For systems installed between 1 July 2011 and 30 June 2012, the multiplier will be reduced to a factor of three, and for systems installed between 1 July 2012 and 30 June 2013 the multiplier will be reduced to a factor of two.

Solar Flagships – redirection of funding
The Government will reduce funding for the Solar Flagships program by $220.0 million over two years from 2012-13. Funding for the program will be restored beyond the forward estimates ($110.0 million per annum in 2015‑16 and 2016‑17).

Connecting Renewables Initiative – funding announcement
The Government will provide $1.4 million over three years to support the design phase of the Connecting Renewables — Connecting to the Grid program. This appears to be a reduction in the previously indication of $100 million over the next four years and $1 billion over the next decade.

Renewable Energy Target — implementation of legislative amendments
The Government will provide $58.8 million over five years to implement a number of amendments to the Renewable Energy (Electricity) Act 2000, including the introduction of an inspection regime for solar panel installations and increased compliance powers for the Renewable Energy Regulator.

The cost of the inspection regime from 2011 12 onwards will be partially recovered through an increase in the registration fee for Small scale Technology Certificates, from 8 cents to 47 cents.

Solar Cities — additional funding
The Government will provide $13.7 million over two years to meet commitments under the Solar Cities program. The program trials sustainable models for electricity supply and use across seven cities. The additional funding will allow continued data collection and analysis to assist governments, industries and individuals to support wise energy usage.

Emerging Renewables — establishment
The Government will provide $104.2 million over five years to support the development of emerging Australian renewable energy technology, especially in the areas of geothermal energy and ocean energy technology. The program will be administered by the Australian Centre for Renewable Energy.

Renewable Energy Venture Capital Fund — establishment
The Government will provide $108.7 million over 14 years to support the development and commercialisation of renewable energy technologies by making early stage equity investments that leverage private funds. Of this amount, $8.7 million will be provided to support delivery of the program by the Australian Centre for Renewable Energy. The $100.0 million grant component will be met from the existing funding provision for the Renewable Energy Future Fund.

Upstream Petroleum Regulatory Reform — revised arrangements

The Government will provide $20.9 million over two years for the establishment of the National Offshore Petroleum Safety and Environmental Management Authority and the National Offshore Petroleum Titles Administrator. This represents a net increase in establishment costs of $4.1 million from the funding previously provided for the establishment of a new regulator.

The National Offshore Petroleum Safety and Environmental Management Authority will be responsible for regulation, in Commonwealth waters, of well integrity, environment plans and day to day operations, and will take over occupational health and safety regulation from the National Offshore Petroleum Safety Authority. The National Offshore Petroleum Titles Administrator will be established as a statutory office in the Department of Resources, Energy and Tourism to advise on title decisions, and administer titles and data in Commonwealth waters. Both entities will operate on a full cost recovery basis from 1 January 2012.

Registration fees payable by industry under the Offshore Petroleum and Greenhouse Gas Storage (Registration Fees) Act 2006 will be retained by the Government, rather than passed on to the states and the Northern Territory, for a two year period from 1 July 2011 to meet the establishment costs. This will result in a net increase of $11.7 million in revenue retained over three years. Ongoing cost recovery arrangements are to be addressed later in 2011.

Low Carbon Fossil Fuel Generation

Carbon Capture and Storage Flagships — reduction and deferral of funding
The Government will reduce funding for the Carbon Capture and Storage Flagships program by $420.9 million over five years from 2010 11. Funding of $260.0 million will be restored to the program beyond the forward estimates. The program will now provide funding of $1.6 billion, including $100.0 million under the Education Investment Fund.

Global Carbon Capture and Storage Institute — reduction in funding
The Government will reduce funding for the Global Carbon Capture and Storage Institute by $45.0 million over two years from 2011 12.

National Low Emissions Coal Initiative — reduction in funding
The Government will reduce funding for the National Low Emissions Coal Initiative by $12.8 million over five years. The program will now provide funding of $149.7 million over four years from 2011 12.

National CO2 Infrastructure Plan — establishment
The Government will provide $60.9 million over four years to support the establishment of a National CO2 Infrastructure Plan. The plan includes four main elements:

  • a multi‑basin CO2 storage exploration and appraisal program to facilitate long‑term CO2 storage hubs;
  • acquisition of significant pre‑competitive offshore and onshore CO2 storage data in basins in New South Wales, Victoria and Western Australia;
  • a National CO-2 Drilling Rig Deployment Strategy; and
  • a National CO2 storage and Transport Infrastructure Assessment.

Energy Efficiency

Green Start program — cessation
The Government will not proceed with the planned commencement of the Green Start program. The program was to deliver home sustainability assessments for households and assist low income households to improve their energy efficiency. This measure will provide savings of $209.5 million over three years.

Energy efficiency functions — additional funding
The Government will provide $28.1 million over five years to the Department of Climate Change and Energy Efficiency to assist in the delivery of its energy efficiency functions, which were transferred from the then Department of the Environment, Water, Heritage and the Arts as part of the machinery of government changes in March 2010. This funding includes delivery of the COAG National Strategy on Energy
Efficiency and a range of energy efficiency programs.

Energy Efficiency Opportunities Program - expansion
The Government will provide $3.9 million over four years from 2010 11 to expand the Energy Efficiency Opportunities Program to include the electricity generation sector and to allow the Department of Resources, Energy and Tourism to develop new emissions and Carbon Capture and Storage ready standards for all new coal fired power stations.
 

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