Australia’s solar power industry has vowed to expand its marginal-seats campaign against the Coalition and aims “to remove this government from office” after ministers directed the Clean Energy Finance Corporation (CEFC) to avoid wind and small-scale solar investments.

The Australian Solar Council has previously targeted numerous marginal electorates in opposition to cuts to the 2020 renewable energy target (RET) but is now flagging a much larger campaign with a multimillion-dollar budget aimed directly at the prime minister, Tony Abbott.

“If the Abbott government is returned and has control of the Senate, our industry is finished,” the council’s chief executive, John Grimes, told Guardian Australia.

“Either the Abbott government changes its policy on this – and given all of the history and indications we assess that that will never happen – so the next step is we’ve got to remove this government from office.

“They are completely out of step with the Australian public on the issue of renewables and we will harness and give voice to that constituency and the government will pay the political price.”

The latest flare-up relates to the government’s proposed instructions to the CEFC, otherwise known as the $10bn “green bank” that the Gillard government established in 2012 to invest in clean energy projects and technologies.

Abbott said he wanted the CEFC to “invest in new and emerging technologies, the things that might not otherwise get finance” and “certainly not existing windfarms”.

The draft investment mandate has not been released but the environment minister, Greg Hunt, said the government had asked the CEFC “to focus on its core mandate of emerging and innovative renewable energy technology” such as large-scale solar.

The CEFC is seeking legal advice on the correspondence it received from the treasurer, Joe Hockey, and the finance minister, Mathias Cormann, on 24 June. It is expected to respond by 24 July, after which the government will consider finalising the order.

Hockey indicated the CEFC had asked for an extension of time. “I think they misplaced the letter or something to that effect. I’m happy to give them an extension,” he said on Tuesday.



“In relation to a number of investments in wind turbines and household solar panels, they [the CEFC] have simply been a member of a funding syndicate with other banks. Now if they’re just another bank that is participating in a lending syndicate, well, that’s the sort of business a private sector can do.”

Lawyer Stephen Keim SC, who provided advice to environmental groups about a previous direction issued to the CEFC in 2013, said the government had powers relating to the investment mandate, but had to tread carefully.



“The particular way in which the act describes the purpose of the investment function of the corporation, as it’s called, is to invest ‘in businesses or projects for the development or commercialisation ... or in relation to the use of, clean energy technologies’,” he told ABC Radio National.

“It doesn’t say emerging and innovative technologies and one would think that when you talk about development you’re down at the innovative end, when you talk about commercialisation you’re taking a new energy and putting it into use, but when you start to talk about in relation to the use of, that seems to me that that can include what the government calls mature technologies as well.

“So it seems to me that the emphasis that the government has is not something that is spelled out in the act.”

Section 64 of the Clean Energy Finance Corporation Act says the responsible ministers may give the board directions about the performance of the CEFC’s investment function.

It says such a direction “may set out the policies to be pursued by the corporation in relation to” numerous issues including “technologies, projects and businesses that are eligible for investment” and “the allocation of investments between the various classes of clean energy technologies”.

Keim said the relevant ministers could issue directions “as long as what they’re doing is not inconsistent with the act and the purposes of the act”.

“They do have to tread a fairly thin line ... and of course the purpose of the act is spelled out to get as much investment in clean energy technologies as you can, and that includes renewable technologies, and renewable technologies obviously includes wind, solar, wave,” he said.



“If there was evidence that the direction was to frustrate the purpose of the act then the corporation would have a basis for seeking to set aside the direction.”

The political upheaval over the CEFC coincides with plans by the Australian Renewable Energy Agency (Arena) to proceed with a new large-scale solar auction.



Arena announced on Tuesday it was planning to provide $80m to $100m in support through the competitive funding round, which was likely to open in September.



The CEFC’s chief executive, Oliver Yates, welcomed the announcement, saying the CEFC would work closely with Arena “to identify opportunities for debt financing”.



“The solar potential of Australia is obvious but financing for large-scale solar has been difficult due to market and policy uncertainty,” Yates said.



Larissa Waters, a deputy leader of the Greens, said Arena’s new funding round was “a glimmer of hope in an otherwise bleak outlook for renewable energy in Australia” and she would welcome a double-dissolution election fought on clean energy issues.



On Tuesday the Labor leader, Bill Shorten, visited wind energy company Vestas Wind Systems in Melbourne to urge Abbott to “stop his war on windfarms and his assault on solar”.



“Mr Abbott needs to come out here and see the real jobs being created by renewable energy,” Shorten said. “There are literally thousands of jobs in the balance and billions of dollars of investment ... Why is Mr Abbott so stuck in the past that he is missing the jobs of the future?”

Hunt said the Coalition had twice tried to implement its election promise to abolish the CEFC – both attempts were blocked by the Senate – “but if you still have this body, it should be focusing on emerging technologies”.

“I’m not sure why Bill Shorten’s against focusing on large-scale solar,” Hunt told Canberra radio station 2CC on Tuesday. “I would have thought that that’s precisely the sort of thing that we want to be encouraging.”

Grimes rejected the government’s argument that it was eager to support large-scale solar, asking: “If they were so serious about large-scale solar why did they cut the RET from 41,000 gigawatt hours to 33,000 gigawatt hours?”

Grimes said the government had misjudged public sentiment on renewable energy. “Some of our biggest supporters are traditional, rusted-on Coalition supporters,” he said.



“The reason they’re so angry is they can see that the transformation of our economy is the biggest business opportunity that Australia has ever seen. They say to me, ‘We thought this was the government of small business, we thought this was the government of competition and choice, and instead of delivering against that they want to close this down.’”

Grimes said the Australian Solar Council’s previous marginal-seats campaign on the RET demonstrated “that we are deadly serious about protecting the interests of consumers and of our industry”.



“Seven [marginal seats] is just the tip of the iceberg,” he said. “It has to be a budget worth millions. We spent $1m on the last campaign. This will be a multimillion-dollar budget. We will be looking to partner with unusual suspects – organisations that aren’t activist, renewable-focused organisations but are concerned about the outcomes for the Australian community.”

Grimes said the aim of the campaign was to change the government, but added: “If there’s a different prime minister then it is a different government. We don’t see a pathway where prime minister Abbott can lead Australia to a positive renewable energy future; it’s simply not possible.”

Kevin Rudd’s Labor government endured significant political pressure in 2010 when the mining industry ran an expensive advertising campaign against the proposed resource super profit tax.

It was one of the matters Julia Gillard said she wanted to resolve when she successfully challenged Rudd for the leadership. She immediately asked the mining industry to cancel the ads to allow negotiations on a revised mining tax to resume.