CEFC could write contracts before July

Australia’s newly created Clean Energy Finance Corporation (CEFC) is likely to enter contracts for finance deals before July 1, when the first of its $10 billion in funding becomes available.

The CEFC was enacted through legislation as part of April’s Clean Energy Future package and aims to leverage private sector financing for clean energy and technology projects. Becoming fully operational in April, the CEFC is run by an independent board of experts in banking, investment management and clean energy and technology – including ex-Low Carbon Australia employees (LCA).

The corporation’s chief executive officer Oliver Yates told RenewEconomy the work of the LCA would continue and would likely be upscaled.

“These organisations have got budget cycles, so they find it hard to fund such investments up front. We can help with that,” Mr Yates said.

Mr Yates also identified solar leasing as an area of interest for the CEFC.

The federal government recently gave CEFC a final investment mandate of $10 billion to spend over five years on supporting emerging renewable and low emission projects through loans, guarantees and equity investments, including $2 billion in the 2013-2014 financial year.

Treasurer Wayne Swan, Finance Minister Penny Wong and Climate Change Minister Greg Combet released the investment mandate for the fund in a joint statement, which states the CEFC will have a “portfolio benchmark return” based on an average five-year government bond rate.

“The Government is committed to developing the clean energy sector and it has established the Corporation to invest for the long term,” the statement read.

“Therefore the Investment Mandate establishes long-term portfolio performance measures.”