Independent MP Zali Steggall has asked the auditor general to investigate a Morrison government scheme to underwrite gas, hydro and coal power, saying it lacks transparency and citing legal advice that the Coalition had no constitutional or legislative authority to introduce it.

Announced in late 2018 after the government abandoned Malcolm Turnbull’s proposed national energy guarantee, the underwriting new generation investment (Ungi) scheme promises public support for new dispatchable power generation projects to increase competition in the electricity grid. Twelve projects have been shortlisted, including six pumped hydro plants, five gas generators and an upgrade to the Vales Point coal-fired power plant.

Steggall has written to the auditor general, Grant Hehir, asking him to consider investigating the program “as a matter of priority”. Her letter refers to research by The Australia Institute, a progressive thinktank, suggesting the program has no constitutional or legislative standing, no guidelines or criteria to assess projects, and its development and implementation did not follow a clear process.

She said despite these apparent flaws the government had shortlisted projects, started “advanced negotiations” to support gas-fired plants in Victoria and Queensland and entered a memorandum-of-understanding with the New South Wales government to support three projects in the state.

The federal government is increasingly emphasising the need for greater investment in “fast-start” gas power. In media interviews over the past week, the energy and emissions reduction minister, Angus Taylor, has called for a “gas-fired recovery” from the Covid-19 pandemic after the collapse of oil and gas prices. The federal-NSW MOU says the state will set a target to increase the amount of gas available each year by 70 petajoules, a more than 50% increase.

Steggall, who entered parliament last year on a climate action platform, said the focus on fossil fuels was questionable and there was little visibility of how and why the projects shortlisted for underwriting had been chosen.

She said her concern about the program was heightened by the controversy over the $100m sports grant program that led to the resignation of former minister Bridget McKenzie. The Australian National Audit Office found 43% of projects funded under that program were ineligible when agreements were signed.

“There’s just no transparency or accountability around this,” Steggall told Guardian Australia. “We’ve seen what happened with sport rorts. We’re talking about commonwealth money at a time when we know the economy has taken a hit due to coronavirus, and I think it should be properly investigated.”

The Australia Institute analysis is based in part on a legal opinion by barristers Fiona McLeod SC and Lindy Barrett, which said Taylor does not have constitutional authority over electricity or legislative authority to fund projects as proposed under the Ungi scheme.

A spokesman for Taylor rejected this opinion. He said the then Department of Environment and Energy commissioned legal advice and “undertook all necessary legal steps, including publishing clear merit criteria” in December 2018.

The spokesman said the Ungi scheme was introduced after the Australian Competition and Consumer Commission identified the need for new “firm” generation in the electricity grid to improve reliability, promote competition and drive down prices, particularly for commercial and industrial customers.

“The Ungi program, which is the most cost-effective way to bring firm generation into the market, is a direct response to this recommendation of the ACCC,” Taylor’s spokesman said.

Tony Wood, the energy program director at the Grattan Institute, last year warned the scheme was quite different to the ACCC recommendation that sparked it and could could work against the government’s goals of helping cut power bills and ensuring there was enough firm electricity that could be called on at any time as it would make energy companies without government support less likely to invest in new generation.