Arena-Annual-Report-2018-19.Pdf
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ANNUAL REPORT 2018-19 2 OVERVIEW is the Australian Renewable Energy Agency, established by the Australian Government to improve the competitiveness of renewable energy technologies and increase the supply of renewable energy in Australia. OUR PURPOSE is to accelerate Australia’s shift to affordable and reliable renewable energy. ARENA ANNUAL REPORT 2018–19 3 OUR VALUES are to be impact-driven, stakeholder-focused, collaborative, accountable and respectful of people. OUR WORK is to support Australian renewable energy projects with financial assistance to maximise the benefits of the energy transition to the Australian economy. Since 2012, ARENA has supported 478 projects with $1.44 billion in grant funding, unlocking total investment of almost $5.5 billion in Australia’s renewable energy industry. 4 OVERVIEW FIGURE 1: ARENA AT A GLANCE - FUNDING COMMITMENTS TO PROJECTS 2012-19* INVESTED PROJECTS $1.44B 478 PROJECTS BY TECHNOLOGY STORAGE - BIOENERGY BATTERIES/PHES OCEAN GEOTHERMAL HYDROGEN $100M $95M $54M $42M $35M GRID SOLAR SOLAR PV INTEGRATION THERMAL HYBRID $654M $205M $145M $105M TOTAL PROJECT VALUE INVESTMENT LEVERAGE $ $5.49B $1:$2.83 *At 30 June 2019 ARENA ANNUAL REPORT 2018–19 5 PROJECTS PROJECTS NT 7 QLD 47 INVESTED INVESTED FIGURE 1: ARENA AT A GLANCE - $34M $190M FUNDING COMMITMENTS TO PROJECTS 2012-19* VALUE VALUE PROJECTS $70M $1.16B PROJECTS WA 28 NSW 198 INVESTED INVESTED $124M $731M VALUE VALUE $1.06B $2.18B PROJECTS PROJECTS SA 41 VIC 81 INVESTED INVESTED $120M $139M PROJECTS PROJECTS VALUE VALUE TAS 17 ACT 59 $420M $340M INVESTED INVESTED $39M $58M VALUE VALUE $93M $162M 6 OVERVIEW ARENA NEW PROJECTS 2018-19 INVESTMENT PRIORITIES 1. DELIVERING SECURE & RELIABLE ELECTRICITY $86.9 39 MILLION NEW PROJECTS 2. ACCELERATING SOLAR PV INNOVATION $2.0* 3 $188.1 MILLION NEW PROJECTS MILLION 3. IMPROVING ENERGY PRODUCTIVITY $67.0 13 79 MILLION NEW PROJECTS PROJECTS 4. EXPORTING RENEWABLE ENERGY $18.7 13 MILLION NEW PROJECTS During 2018-19 ARENA committed $188.1 million OTHER in grant funding to 79 new projects across four $13.0 11 investment priorities. MILLION NEW PROJECTS ARENA ANNUAL REPORT 2018–19 7 Advanced weather Trial to show how forecasting technologies to smoothly integrate being developed to electricity from Virtual improve the reliability Power Plants into of wind and solar energy the grid Australian-first project Big battery paired with Projects focused on to power a mine with a a wind farm to show their delivering affordable hybrid microgrid using combined services can low-emission electricity wind, solar, battery strengthen the grid solutions that keep the and gas lights on Next stage of Identifying how to get the development reached most benefit for homes by online electricity and businesses from the marketplace for homes energy they produce while and businesses to trade keeping the grid strong the energy they produce Trial of self-powering solar classrooms extended to more schools Projects focused on making solar PV more affordable through research and development * $38 million also committed to extend the Australian Centre for Advanced Photovoltaics to continue world-leading research in solar PV R&D Australian-first project Help the rollout of ultra- to produce 36 MW of rapid charging networks baseload power from for electric vehicles household waste, diverting 25 per cent from landfill First off-grid project with Pioneering project Projects focused on the oil and gas industry, established to turn helping to reduce energy also involving an off-grid biosolids from sewage costs and emissions in switch to 100 per cent into crude oil renewables the transport, building and industry sectors Supported the First-of-a-kind project transformation of a to test if renewables can decommissioned car be used reliably in metal manufacturing plant into production a renewable energy hub 16 new hydrogen Established projects to R&D projects demonstrate how best to produce, store and use renewable hydrogen Projects focused on helping to create new, scalable export value chains in renewable energy 8 OVERVIEW ABOUT THIS REPORT This Annual Report provides information about ARENA’s activities and achievements in 2018-19. Results are reported against our objective and performance criteria, which are stated in the ARENA Act, our Corporate Plan and our Portfolio Budget Statements 2018–19. We also describe our governance, management and accountability practices, our workforce and financial performance, and provide our audited financial statements. CONTENTS ARENA AT A GLANCE 4 ARENA NEW PROJECTS 2018-19 6 LETTER OF TRANSMITTAL 11 CHAIR AND CEO REVIEW 12 ABOUT ARENA 17 Key elements 18 How we work 20 Our strategic approach 2 1 Getting the best value from our projects 22 Our complementary role 24 ARENA Board 26 ARENA senior executives 34 FINANCIAL PERFORMANCE 37 ARENA SHOWCASE 41 Renewables making good business sense 42 Renewables strengthening the grid 52 Maximising the benefits of distributed renewables 54 Renewables on the move 56 ARENA ANNUAL REPORT 2018–19 9 GOVERNANCE 61 Board governance 62 Board committees 62 Risk management 66 Conflict of interest 67 Fraud control 68 Indemnities and insurance premiums of officers 68 Remuneration 69 LEGISLATIVE, GOVERNMENT AND OTHER INFORMATION 71 Enabling legislation 72 Portfolio Minister engagement 72 Engagement with our stakeholders 73 Environmental performance 74 Judicial decisions and reviews by outside bodies 75 Legal expenditure 75 Material matters 75 Related entity transactions 75 Service level agreement 76 Subsidiaries 76 Workforce 76 Work health and safety 78 FINANCIAL STATEMENTS 81 ANNUAL PERFORMANCE STATEMENT 2018-19 105 Statement of preparation 106 Performance framework 106 About this Annual Performance Statement 107 Section 1: Context 110 Section 2: Performance case studies 111 Section 3: Core activity areas 124 APPENDICES 155 Appendix 1: Financial assistance agreements and progress 156 Appendix 2: Index of compliance with annual report requirements 186 Appendix 3: Mandatory information for Transparency Portal 189 Appendix 4: List of figures and tables 193 Appendix 5: Glossary 195 INDEX 199 PUBLICATION DETAILS 206 10 OVERVIEW Image credit: Stock image ARENA ANNUAL REPORT 2018–19 11 OFFICE OF THE CHAIR 18 September 2019 THE HON ANGUS TAYLOR MP Minister for Energy and Emissions Reduction PO Box 6022 Parliament House CANBERRA ACT 2600 DEAR MINISTER ARENA ANNUAL REPORT 2018-19 I am pleased to present to you the Australian Renewable Energy Agency (ARENA) Annual Report for the financial year 2018-19, in accordance with the requirements of the Australian Renewable Energy Agency Act 2011 (ARENA Act) and the Public Governance, Performance and Accountability Act 2013 (PGPA Act). The ARENA Board is responsible for preparing the report and providing it to you in accordance with s46 of the PGPA Act. The report was approved by a resolution of ARENA’s Board on 18 September 2019. This report incorporates ARENA’s Annual Performance Statement (APS) for 2018-19, as required by s39 of the PGPA Act. In the opinion of the Board, the APS accurately presents information about ARENA’s performance for the reporting period and complies with s39(2) of the PGPA Act. The report also includes ARENA’s audited financial statements prepared according to s42 of the PGPA Act. Yours sincerely MARTIJN WILDER AM Chair 12 OVERVIEW CHAIR AND CEO REVIEW Image: Mr Martijn Wilder AM (left) and Mr Darren Miller Helping Australia’s energy barriers. We have also funded projects and research and provided advice throughout the system manage an increasing course of this year that is helping to solve some share of renewables and of these economy-wide issues. different ways of operating The energy transition increasingly involves has been an important focus sectors such as transport, heavy industry and the built environment, which are critical in the for ARENA this year. pursuit of lower emissions and ensuring Australia meets its international commitments. ARENA’s This economy-wide transformation is profound, investment priorities and activities have targeted complex and gathering pace as technology costs these key sectors during 2018-19. decline, new business opportunities emerge, and consumers, as well as businesses, increasingly ARENA invests in projects spanning the demand more choice and more control over innovation chain, from research to early-stage their energy source, use and cost. deployment, to help push first-of-a-kind energy technologies and business models towards ARENA is playing an instrumental role in commercial viability. Without our support, the funding and assisting this transition. We pathway to commercialisation would be blocked act as a connector, bringing stakeholders for many of these new technologies together and leading innovation and and businesses. issue-solving across sectors, businesses, governments and industry organisations. ARENA is committed to achieving maximum impact and value from the projects we fund. We have actively identified and are helping to We work closely with our project proponents troubleshoot issues arising from the changing to ensure we progress high-quality applications energy system – from technological and through our approval processes. commercial issues to regulatory and market ARENA ANNUAL REPORT 2018–19 13 In 2018-19, we committed Four ‘big battery’ projects (two in Victoria and two in South Australia) demonstrated $188.1 million to 79 new innovative technologies and operating projects with a total value of capabilities that progressed the status of large-scale battery