A renewable energy company controlled by the Chinese government is receiving taxpayer-funded support under Chris Bowen’s flagship Capacity Investment Scheme, in a move likened to allowing Huawei to build Australia’s 5G network.
Through the scheme, taxpayers are underwriting the construction of a $120m large-scale battery at Clements Gap in South Australia’s Mid North, run by energy company Pacific Blue.
While it has an Australian executive team and local operations, Pacific Blue – which runs more than 12 wind, solar, and hydro projects across Australia – is wholly owned by the Chinese government’s State Power Investment Corporation (SPIC).
According to global ratings agency Fitch, the Chinese government’s State-Owned Supervision and Administration Commission has “broad control and oversight over SPIC’s operations, strategies and core management”.
SPIC is also an active participant in President Xi Jinping’s signature Belt and Road Initiative, which the US government has labelled an attempt to “create economic dependencies and coerce others”.
Peter Jennings, the director of Strategic Analysis Australia, said the Albanese government had “learnt nothing and remembers nothing” from the exclusion of Chinese telco Huawei from bidding for 5G contracts in 2018.
“Now we’re going through a repeat of this process but with the government completely ignoring the impact of allowing Chinese state-owned companies to develop key parts of Australia’s critical electricity infrastructure,” he said.
“Chinese businesses – and especially state-owned enterprises – are governed by China’s national security laws which require they give China’s intelligence services access to their operations.
“It gives hostile intelligence services the capacity to install malware, kill switches, and other forms of technology designed to give China control over critical infrastructure during moments of tension.”
The Capacity Investment Scheme (CIS) – which underwrites investment in clean energy – has also backed projects led by firms in Spain, Denmark, Japan and the Philippines. The Sunday Mail has previously revealed renewable-energy company Genaspi Energy outsourced work to multiple Chinese companies on its CIS-backed battery project in Bundey, also in the Mid North.
Dan Tehan, the Coalition’s energy spokesman, said the government had “made a mess” of the energy transition.
“What checks and assurances can the Australian people be given that this (project) is in our national interest and, in particular, our national security interest?” he said.
A spokesman for Pacific Blue said it was “incorrect to imply that the taxpayer will pay anything for projects approved under the CIS”.
“The scheme simply offers a guaranteed wholesale floor price for the electricity generated and stored by the projects it supports, but when prices are above the set price, then revenue is shared with the federal government,” he said.
Mr Bowen was contacted for comment.
page 61: editorial