STT scoops The Australian on green-slush fund shenanigans

Always ahead of the hack-pack, STT beat The Australian to the story of how the CEFC and ARENA fund are shovelling out $millions to their wind farm operator mates in our post last Friday, “On the Hunt for the missing $millions”.

Anyway, better late than never, here’s today’s effort in the Oz.

Green funding rush fires loans row as $800M push defies Tony Abbott
The Australian
Sid Maher
29 May 2013

THE Clean Energy Finance Corporation is planning to write up to $800 million in green loans before the election, defying the Coalition’s call for the agency not to sign contracts before September 14 because Tony Abbott has vowed to scrap it.

The CEFC has revealed it is in “active discussions” with 50 projects seeking $2 billion and that an additional 119 project proponents have presented proposals that are seeking finance worth $3.3bn. The figures are contained in an email from the CEFC to the opposition pleading its case not to be scrapped if the Coalition wins the election.

The CEFC was established as part of the Gillard government’s Clean Energy Future package to provide finance to clean energy projects that might not otherwise be able to raise funds through the commercial banking system. It receives an allocation of $2bn a year for five years which has been locked into the government’s budget through legislation.

The scale of discussions under way between the CEFC and clean energy project proponents puts it on a collision course with the Coalition, which in February wrote to the CEFC asking it not to write any loans between July 1 and the election.

Opposition finance spokesman Andrew Robb said the Coalition was “deeply troubled by the indecent haste to start risking many billions of dollars of borrowed money”.

“There is simply no valid reason for agreements to be struck, contracts to be signed or for funds to be meted out this side of the election,” Mr Robb said. “It is unconscionable. We have been crystal clear in our opposition to the CEFC and in our resolve to abolish it. We will do whatever we can to prevent $10bn of borrowed money from being wasted.”

CEFC chief executive Oliver Yates last night said the agency, which can begin writing loans from July 1, would do so in an orderly way and was planning to write about $1bn worth of loans every six months.

Asked what the CEFC could write between its start date of July 1 and August 12, when the pre-election caretaker period begins, Mr Yates said he would be happy if the CEFC could write between $600m and $800m. However, all agreements would be subject to extensive due diligence.

The CEFC has revealed the full value of the 50 projects in “active discussions” is put at $4.6bn and the 119 extra projects for which submissions have been received are worth more than $6bn.

In the email to the opposition, Mr Yates said there had been a “resounding positive response to date from the market, demonstrating the significant role which the CEFC can play”.

He revealed the CEFC was working on a dozen projects in Victoria that would deliver jobs and growth “but all are now in question”. “These projects have a total expected size of nearly $2.5bn,” he said.

The letter also revealed the CEFC had tightened its lending criteria and it had removed an assumption that it would grant or lose 7.5 per cent of the investment portfolio.

“We determined that to operate commercially the CEFC would not make grants or what was termed ‘immediately impaired loans’,” Mr Yates wrote. “The making of such are inconsistent with the approach of being self-sustaining and commercial.”

Mr Yates argued that the difference between the CEFC and a traditional financial institution was that “we don’t seek maximum profits but seek to cover operating and funding costs, and use the potential to make higher profits to secure public policy benefits and reduce the cost of moving to a lower-carbon economy”.

“We will participate alongside traditional financiers and may from time to time rub shoulders as we build our market presence and financial self-sufficiency,” he said. “That said, the net effect of our participation in the market will be to increase available funding opportunities for the private sector, not reduce them.”

Mr Yates said the CEFC was focused on being a sustainable institution and, where a loan was written below the bond rate for a public policy purpose, another might be written at a commercial rate to ensure the business was sustainable.

In his budget reply speech this month, the Opposition Leader repeated his vow to “scrap Labor’s green-loans scheme for projects that the banks won’t touch”.

The corporation’s chairwoman and Reserve Bank board member Jillian Broadbent has previously said there was “significant appetite” for funds and has signalled that the CEFC would seek to act according to its mandate to write loans, despite the opposition’s request not to do so.
The Australian

CEFC head, Yate’s observations that there has been a “resounding positive response to date from the market, demonstrating the significant role which the CEFC can play” and that the CEFC doesn’t “seek maximum profits but seeks to cover operating and funding costs” can’t pass without comment.

The latter point is a reference to the fact that CEFC doesn’t charge developers anything like market rates for interest.

As to the first point, if there was an offer to lend $millions, virtually interest free, with no need to offer meaningful security and underwritten by the Australian taxpayer (who will pick up the full cost of interest and all of the exorbitant administration costs – this is run by Commonwealth Public Servants, remember) you’d be knocked down in a crush that would look like Myers when the doors open for the Boxing Day Sales.

The Australian doesn’t say it, but all of the “projects” are windfarms, principally in Victoria.

STT has heard that one of the main contenders for the fat pile of cash being doled out by the CEFC is none other than Pac Hydro – the outfit run by Union Heavyweight, Gary Weaven, Greg Combet’s best little buddy. Oh, and Infigen apparently has its trotters in the trough too.

Good luck recovering an entirely unsecured loan from a crowd with Infigen’s track record! S%&t – hang on a minute? STT just realised WE – the TAXPAYER – will have to pick up the tab, yet again.

These people really are Dirty, Rotten Scoundrels.

dirtyrottenscoundrelsoriginal

Fancy a few $billion of taxpayers money, Gary.
Cheers, Greg, don’t mind if I do.

About stopthesethings

We are a group of citizens concerned about the rapid spread of industrial wind power generation installations across Australia.

Comments

  1. I can now say exactly what I am living with,
    It’s EMR – Electromagnetic Radiation.
    God help us all living in this area.

  2. They are thieves, trying to grab the last few pennies before you yank their grubby little paws out of your pockets!!!

Trackbacks

  1. […] as just another cost to be added to insane levels of subsidy (read RECs and unsecured (virtually) interest free loans from the CEFC, for […]

  2. […] that legitimate financial institutions wouldn’t touch with a barge pole.  See our posts here and here and […]

  3. […] These corporate cowboys have nothing of value to offer real banks, so they all lined up to fleece us instead. […]

  4. […] only remaining source of finance is the Clean Energy Finance Corporation which the Coalition is about to take to with an axe.  Fair play to Tony – it was, after all, […]

  5. […] Financiers aren’t lending wind weasels any money for new projects – the money men see RISK all over this great wind scam.  Without a PPA the wind weasel has no valuable asset to leverage against – the only thing they own are turbines that require the blades and generators to be changed every couple of years which – once the warranty runs out – makes them a liability – not an asset. […]

  6. […] her eco-fascist buddies want to fleece the poor and give it to undeserving thugs and thieves like Pac Hydro and Infigen.  All sound political stuff – if you hate your own people – and want to see them live in […]

  7. […] guess is that the money being shovelled out of the CEFC to Pac Hydro and the other wind scammers will keep the circus running for a little while longer. […]

  8. […] By directing our resources to hydro power we will create real employment as we upgrade and improve existing hydro systems and construct those systems which have been planned, but starved of capital, because the wind industry has managed to snaffle the REC Tax and every other subsidy, including interest-free loans being bucketed out by the CEFC. […]

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