Is Australia Losing the Race for a Clean Energy Breakthrough?

Despite a strong track record on renewables innovation,
Australia may be running out of time to become a clean energy
export powerhouse — andfurther funding for homegrown innovation
is now in jeopardy.

The budget for the Australian Renewable Energy Agency (ARENA),
Australia’s flagship energy innovation funding body, is set to
run out this year, and the current administration has yet to
confirm that more cash will be allocated.

Australia’s ruling Liberal Party has tried to do away with
ARENA in the recent past. While the energy agency appears to enjoy
broad cross-party support, it remains to be seen where the
coal-loving Liberals’ priorities will lie in a post-COVID-19
economy. Concern over the future of ARENA led progressive think
tank The Australia Institute to issue a paper in January calling
for the urgent approval of legislation to extend the agency’s
funding.

While ARENA’s grant-making funding officially ends in mid-2022,
the nature of energy project planning means the agency will
effectively cease making new investments this year, said
the Australia Institute’s paper
.

ARENA’s supporters say continued funding will be key to helping
Australia decarbonize its grid during the Paris Climate Agreement
period, to say nothing of cashing in on the growing global market
for clean energy technologies. Companies in Australia are pursuing
a series of big bets in emerging energy markets such as
long-duration storage
and
green hydrogen
.

Cynics might counter that fostering clean energy innovation
hasn’t been Australia’s problem â€” it’s getting those ideas to
market. So far, ARENA has supported 538 projects with AUD $1.58
billion (USD $1.08 billion) in grant funding since 2012.

Alongside the agency, a body called the Clean Energy Finance
Council (CEFC) is responsible for investing AUD $10 billion (USD
$6.9 billion) in clean energy projects, and as of the end of last
year had mobilized a further AUD $26 billion (USD $18 billion) in
private capital.

The CEFC has backed a range of technologies, including electric
vehicle charging infrastructure, battery storage, lightweight
carbon fiber wheels that reduce emissions, and smart energy
systems, executive director Monique Miller said in an email.

Yet while Australia has produced a number of novel energy
technologies, the country has been notably unsuccessful at building
an export industry out of them, industry figures say. And it’s a
problem with a long history.

Overcoming ‘cultural cringe’ factor

Two commonly cited examples of Australian energy innovation came
out of the University of New South Wales in the 1980s: the vanadium
redox flow battery and Passivated Emitter and Rear Cell (PERC)
solar technology. Both have been commercialized around the
world â€” just not by Australian companies. Australia’s promising

UltraBattery technology
was bought up by a U.S. company in 2010
and Australian CSP technology developer
Ausra was sold
to French energy giant Areva the same year.

“The challenge for Australia, which has been well documented,
is the transition from successful R&D to successful commercial
business,†said Will Mosley, head of business development at
Victoria-based RayGen Resources, which is touting a novel solar
generation technology.

“Though we have a strong R&D pipeline, there is a
breakdown — driven by investor risk appetite and lack of
available capital — to supporting commercialization of the
R&D breakthroughs,†Mosley told Greentech Media.

RayGen is an example of an innovative Australian clean energy
company. Its technology borrows elements of concentrated PV,
power-tower CSP and steam-based thermal storage, and it has a
manufacturing facility that can produce 25 megawatts of capacity
per year.

ARENA-backed ReyGen says its system can deliver 750 kilowatts of
power per square meter of plant space, with a 32 percent system
efficiency and 10 hours of storage. The company has a 3-megawatt
plant in operation and a 4-megawatt project in the works.

But Mosley said winning business in Australia isn’t easy for
homegrown companies. “It is actually easier to raise money in
Australia as a foreign company,†he said. “The joke is, ‘You
should tell us you’re a German technology firm.’”

This ‘cultural cringe’ factor puts Australian energy
innovators at a disadvantage while foreign companies, such as

Fluence
,
Hydrostor
or
Tesla
, proudly announce reference projects in the country.

Mixed signals on the road ahead

The question now is how much Australian companies will benefit
as the country sets its sights on a decarbonized energy sector.

Last month, the federal government opened consultation on a
technology investment roadmap featuring more than 140 potential
decarbonization technologies. The administration hopes to reduce
this list down to five or six leading contenders, said Jill Cainey,
general manager of networks at Energy Networks Australia, an
industry body representing electricity and gas network
operators.

“During the discussions on the roadmap, Australia was
described by one participant — not the Government — as a
‘technology taker’ rather than a technology maker,†Cainey
said in an email interview. “I think that’s broadly true.â€

The good news for ARENA is that the role of the agency is
highlighted throughout the government document. Observers feel it
would be politically challenging to axe the body. The analysis by
The Australia Institute suggests that real animosity towards ARENA
was confined to the brief leadership of former Liberal prime
minister and climate skeptic Tony Abbott.

Against this, however, Australian investment into large-scale
renewable energy
fell 60 percent
from 2018 to 2019, dampening the outlook for
technology commercialization. And although the government has
pledged to review funding for ARENA based on the outcome of the
technology roadmap consultation, time is running out for the
agency.

“Effectively from the end of this month, ARENA won’t be able
to provide any further grants,†said Cainey.

That’s a worry for companies such as RayGen and thermal
storage innovator 1414 Degrees, which this month
acknowledged challenges in scaling
up
.

Getting Australian cleantech into the wider world will likely
require a mindset shift away from cultural cringe, but without
basic funding the country won’t even be in the race. “This is a
challenging moment for the innovation ecosystem,†said Mosley.
 

Source: FS – GreenTech Media
Is Australia Losing the Race for a Clean Energy
Breakthrough?