That money would be booked as a saving to the budget and legislation would be moved to dissolve ARENA as an independent agency, New Corp papers reported. About $1 billion in existing contracts managed by ARENA would still be honoured. Precarious future: Government likely to axe ARENA. The agency, established through the combination of other bodies in July 2012, aims to increase the supply and competitiveness of renewable energy such as large-scale solar photovoltaic plants and other emerging technologies. “What’s disappointing here is that the Coalition really went out of its way prior to the election to restate their commitment to ARENA,” said Kane Thornton, deputy chief executive of the Clean Energy Council. The Abbott government also backed the Renewable Energy Target (RET) before the September election, saying it would support the existing goal of supplying 41,000 gigawatt-hours of clean energy, such as from wind farms and hydropower, by 2020. It has since set up a review of the target led by businessman and climate change sceptic, Dick Warburton, which the renewable energy industry fears will dilute or delay the RET goal.

Axing the agency “would send concerning signals to the renewable energy sector broadly but also to investors around the world who are making investments under ARENA, and are watching closely the outcome of the RET review”, Mr Thornton said. A leading scientist whose work has been partly funded by ARENA said reports of the agency's demise would come as devastating news for many researchers. "It's the sudden shifts in policy that are really damaging," the researcher said, declining to be named. Institutes that had spent years and significant funds building up expertise would be left wondering about their futures including the fate of project proposals that had reached the final funding assessment stages, 'Clearing the decks' ARENA chairman Greg Bourne warned that if the $10 billion Clean Energy Finance Corporation was axed as promised, major changes were made to the renewable energy target, and ARENA’s unallocated funds was returned to consolidated revenue, then the government would be ‘‘clearing the decks’’ of support for renewables.

Mr Bourne told Fairfax Media there had yet to be a formal notice from the Abbott government that it would move new laws to repeal ARENA's legislation. And until any repeal was successful in parliament, management would have to continue to run ARENA according to the legislation that is in place, which also sets out the agency's budget. Mr Bourne said ARENA had been created in recognition that renewable energy projects needed long-term, secure funding. He said the agency ensured support for the sector was managed independently, away from political interference, and overseen by a commercially savvy board. On ABC’s Radio National on Monday, Finance Minister Mathias Cormann said “too many agencies” were responsible for similar functions and needed to be cut back. “This is about making government as efficient and effective as possible,” Senator Cormann said. Fairfax Media sought comment from the Abbott government.

The government's National Commission of Audit set up to investigate savings in federal spending recommended consolidating ARENA into the Industry department "to provide opportunities and synergies", according to the report released last month. 'Damning reflection' Greens leader Christine Milne said all Australians stood to benefit from investments that led to cheaper long-term energy prices and a safer climate as greenhouse gas emissions from fossil-fuel powered plants drop. "Axing (ARENA) is a damning reflection on the backward thinking of the Abbott government," Senator Milne said. "ARENA uses taxpayer dollars to provide certainty to renewable energy projects," she said. "It would be disastrously counter-productive if this money was funnelled into the farcical Direct Action policy and used to pay polluters instead."

Mark Diesendorf, a renewables energy expert at the University of NSW, said Australia "would be left behind" by the dismantling of Australia's clean energy industry, with many jobs to go. "There is a concerted attack on renewable energy and a serious attempt to stop its growth dead," said Professor Diesendorf. "Public-opinion surveys show that about two-thirds of Australians support the growth of renewable energy." "My view is that they cannot stop the growth of solar PV at the residential and commercial levels, but they can stop wind farms and large solar power plants," he said. "The rest of the world will keep going," he said, citing explosive growth in places such as Europe, Japan and China. Energy starts

Support for emerging renewable energy technologies, which include geo-thermal and marine power, should be seen in the context that all other major forms of energy had got their start with backing from governments, the CEC's Mr Thornton said. “The very first coal-fired power stations, the first gas and the first nuclear power stations were all supported by the government, and wouldn’t have happened without government help,” he said. Among the projects getting ARENA support was AGL’s 155 megawatt-capacity solar photovoltaic power plants at Nyngan and near Broken Hill in NSW. ARENA and the NSW government supplied $166.7 million and $64.9 million, respectively, with AGL supplying the remainder of about $208 million, according to the agency. “That wouldn’t have happened without the support of ARENA,” Mr Thornton said. Loading

“A lot of large-scale solar companies will really question why they are still operating in Australia, and will really focus their efforts on other parts of the world,” he said. Follow us on Twitter