Engie Australia readies 2 GW renewables war chest

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From pv magazine Australia.

According to Reuters, French energy giant Engie is looking to hurry along its ascendancy in Australian renewables investment with a 2 GW fund. 

The reported war chest would invest in 2 GW of solar and wind farms over the next decade, including around 800-1,000 MW already in the pipeline. 

The fossil fuel company is reportedly confident it can attract partners to invest in the fund. In August, IFM Investorswhich holds stakes in infrastructure assets on behalf of seven million Australian industry superannuation fund members – signaled a changing of the tide in pension and financial fund investment towards renewables by announcing unprecedented 2030 emissions targets. 

Engie’s determination to establish its renewable fund is welcome news to the Australian clean energy market amid a post-2020 federal energy policy void.

Energy policy vacuum

report released last month by public policy thinktank the Grattan Institute echoed similar findings by Australian renewables body the Clean Energy Council and forecaster BIS Oxford Economics, which showed a fall in renewables investment to levels not seen since the Tony Abbott era. The authors of the various studies all cited lack of federal policy as the main culprit.

Nevertheless, Engie Australia and New Zealand chief executive Augustin Honorat has noted the inevitability of Australia’s energy transition due to an abundance of natural resources and ageing coal-fired power infrastructure. 

The French utility is so confident in the future of renewables, in fact, it shut its Hazelwood coal-fired power plant and sold its other Australian coal-fired plant in 2017 as part of a global exit from the polluting fuel. Engie still operates, however, in the petrol, natural gas and nuclear power sectors.

Show me the money

The company’s long-time Australian clean energy investment partner, Japan’s Mitsui & Co, is set to contribute to the renewables fund, though specifics on the size of the pot or contributions were not announced. 

Funds of that nature are among the main drivers of the energy transition. Fellow fossil fuel company AGL Energy’s Powering Australian Renewables Fund – developed with the state-owned Queensland Investment Corp – aims to develop and own approximately 1 GW of large scale renewable projects by spending $2-3 billion (US$1.38-2.07 billion). 

In the public sector, green bank the Clean Energy Finance Corporation is encouraging similar developments. The recent Future North report published by solar and energy storage trade body the Smart Energy Council suggested North Queensland requires a similar fund for sustainable development.

By Blake Matich