CEFC spends record $1.9 billion on latest renewables investments

Image credit: CEFC

The Clean Energy Finance Corporation (CEFC) has confirmed $1.9 billion in new investment commitments in the 2022-23 fiscal year, including a record $1.2 billion in renewable energy and grid-related funding commitments by Australia’s ‘green bank’, delivered despite adverse market conditions.

According to the most recent investment report, the CEFC invested a total of $1.9 billion in transactions worth a total of $11.7 billion in the most recent fiscal year, bringing its total investments since it was established through an agreement between the Gillard Labour government and greens to $12.7 billion and a total transaction value of $48.8 billion.

Wind, solar, and storage were the most important components, with $1.2 billion committed to 14 large-scale projects totalling $5.7 billion.

CEO Ian Learmonth said the investment is important for Australia to meet its ambitious renewable energy target of 82 per cent by 2030, especially given recent cost and supply chain challenges.

“With Australia’s renewables sector responding to complex global economic and supply chain pressures, we have confirmed our important role in using our capital to fill market gaps in the face of a difficult market for investors and developers,” Learmonth stated.

Significantly, private sector leverage for CEFC investment commitments hit an all-time high in 2022-23, with each $1 of CEFC funding attracting $5.02 in private sector capital. 

The substantial amount of leverage reflects CEFC investments in large-scale transformational projects, such as a $100 million commitment to the NSW Waratah Super Battery, one of the world’s largest standby network batteries.

The CEFC also committed up to $222.5 million to Victoria’s 756 MW Golden Plains Wind Farm, its single largest investment in a wind project.

The corporation also made a record $54.5 million in new and follow-on investments through the Clean Energy Innovation Fund, operated by Virescent Ventures. 

In the fiscal year 2022-23, each dollar of Innovation Fund investments attracted an extra $6.47 in private sector capital, resulting in a total of $407.3 million for new cleantech enterprises.  

According to Learmonth, the CEFC is seeing the national objective to achieve net zero emissions by 2050 adopted by an expanding number of actors across the economy, particularly in energy demand management. 

“CEFC finance is driving greater ambition at the asset owner level across multiple sectors, including exciting mid-market infrastructure and infrastructure-like businesses in areas from healthcare and energy to transport and data centres,” he explained. 

Learmonth cited notable examples including a $50 million investment with Canadian investors CDPQ in a new sustainable farming platform and a $20 million commitment to innovative automobile leasing business Splend to help convert the rideshare sector to electric vehicles.

The Australian Government also approved an additional $20.5 billion in capital allocations to the CEFC, the first increase since the CEFC’s inception in 2012. 

The additional funds include $19 billion for Rewiring the Nation, which will revamp Australia’s energy transmission grid, $1 billion to assist households in reshaping their energy consumption, and $500 million to support the continuous growth and development of projects and companies in the climate tech sector. 

The CEFC anticipates making investments with the enhanced capital allocation from the 2023-24 fiscal year. 

“The recent increase in our capital allocation to $30.5 billion substantially expands the role of the CEFC as Australia’s ‘green bank’. We begin our second decade with a clear focus on driving new investment through the Rewiring the Nation program, the new Household Energy Upgrades Fund and Powering Australia Technology Fund, alongside our ongoing core businesses,” Learmonth concluded.