Clean Energy Companies Seek $131 Million of Australian Grants

Carnegie Wave Energy Ltd. (CWE), Panax Geothermal Ltd. (PAX) and Petratherm Ltd. (PTR) are among companies planning to apply for A$126 million ($131 million) of Australian government funding set aside to help renewable energy projects.

“We will be seeking as great a contribution as we can possibly get,” Kerry Parker, managing director of Brisbane- based Panax Geothermal, said in a phone interview today. “Our main challenge is funding. The clear message from investors over the last six to 12 months is that they want to see a far greater portion of the costs contributed by the government.”

The Australian government started accepting applications for a renewable energy funding program aimed at spurring the development of “emerging” geothermal, wave, solar and other technologies, Energy Minister Martin Ferguson said today in a statement. At least a third of the grant money, or A$42 million, will go to geothermal companies, Ferguson said.

Australia, the developed world’s biggest per-capita polluter, has set a target of generating 20 percent of its power from renewable energy sources such as wind and solar by 2020. The country plans to set up a A$10 billion Clean Energy Finance Corp. to invest in renewable energy projects seeking to get off the ground, Prime Minister Julia Gillard said last month.

’Flexible’ Funding

The renewable program increased by A$26 million after Torrens Energy Ltd. (TEY), Green Rock Energy Ltd. (GRK), Greenearth Energy Ltd. (GER) and Hot Rock Ltd. (HRL) struggled to attract matching funding and failed to fulfill the requirements of a previous round of grants, the Australian companies said in a joint statement today.

The funding initiative announced today will be more “flexible,” according to Ferguson’s statement.

Panax, among Australian companies seeking to produce power from underground heat, is planning to develop a geothermal project in the Otway Basin in South Australia.

The geothermal company, whose shares have declined 67 percent in Sydney trading this year, will review the details of the program before deciding how much money to seek, Parker said. The company had decided not to spend additional money in Australia until more government funding is available, he said.

Carnegie Wave, focused on wave power technology, intends to compete for some of the new funding, Michael Ottaviano, managing director of the Perth-based company, said by phone today. Carnegie was unsuccessful in 2009 in getting Australian government funds to promote renewable energy.

“If you are applying, you’re going to need to be open to the fact this can’t be your sole route to commercialization,” he said. “That’s something Carnegie has learned in the past. We’re interested, but we’re pursuing other paths in jurisdictions like Ireland and Scotland.”

Petratherm will seek as much as A$5 million in funds, Terry Kallis, managing director of the Adelaide-based geothermal company, said by phone today. Petratherm is targeting funds for its Heliotherm project, which aims to combine geothermal, solar and natural gas technologies to producer power, Kallis said.

Carnegie Wave has declined 31 percent in Sydney trading this year to 7.6 Australian cents, while Petratherm has fallen 4.8 percent to 10 cents. That compares with a 16 percent drop in the S&P/ASX 200 Index.

To contact the reporter on this story: James Paton in Sydney at jpaton4@bloomberg.net

To contact the editor responsible for this story: Amit Prakash at prakash1@bloomberg.net

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