Angus Taylor moves to allow renewable energy agency to fund carbon capture and hydrogen

The energy and emissions reduction minister, Angus Taylor, has moved to expand the mandate of the Australian Renewable Energy Agency (Arena) to allow it to fund carbon capture and storage projects and “clean” hydrogen that can be produced from fossil fuels.

In regulations, published Tuesday, the government added its technology roadmap to the list of initiatives Arena could finance.

The roadmap includes carbon capture and storage (CCS) as well as so-called “clean” hydrogen, which can be hydrogen produced from coal and gas.

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The changes to the agency’s functions, first flagged last year, come as the International Energy Agency warned investment in new oil, coal and gas developments must end this year to meet global climate goals.

The Greens said they would move to disallow the regulations, with the party’s leader, Adam Bandt, saying the changes could be a breach of the Arena Act, which made clear the agency’s function was to fund renewable technology.

“CCS is a failed pipe dream,” Bandt said. “These regulations are a climate disgrace that will funnel public money to big coal and gas corporations, and we will move to disallow them when parliament resumes.”

A spokesman for Taylor said the changes were about getting “more horses in the race”.

“These changes are about bringing a portfolio of technologies to commercial parity so we can reduce emissions across every sector of the economy, without killing jobs,” he said.

“It’s time Anthony Albanese and Chris Bowen walk the talk on clean jobs and support common-sense changes like this.

“The alternative to the government’s approach is more taxes and that’s Labor’s track record in this space.”

Labor’s climate and energy spokesman, Chris Bowen, said the government hadn’t consulted the opposition about the changes.

“The government told the media Labor was opposing the regulation before they bothered to tell Labor they are proposing it,” he said.

“Typical. It’s all about the spin and not about the substance.

“We will consider the regulation in the normal way as part of our usual processes,” he said.

Richie Merzian, the director of the climate and energy program at The Australia Institute, said the Morrison government was “cannibalising our clean energy agencies in their pursuit for more fossil fuel subsidies”.

“These regulations water down the entire purpose of Arena, which is to build a renewable future,” he said.

The explanatory statement for the regulations acknowledges Arena’s legislated functions are restricted to renewable energy but says the new regulations give it “the necessary authority to deliver any non-renewable elements of the programs”.

The Morrison government first announced it would overhaul Arena’s mandate last year so that there would be less investment in solar and wind and more in hydrogen, carbon capture and storage, microgrids and energy efficiency.

At the time, it said many renewable energy technologies were now mature and had “graduated” from the need for government subsidies.

Arena’s mission since its creation in 2012 has been to back projects that can improve the competitiveness of renewable energy technology. With wind and solar electricity generation increasingly cost competitive, its list of recently backed projects include a virtual power plant, an electric vehicle smart charging trial, a scoping study for a planned New South Wales renewable energy zone and a plan for using biogas from sewage to create hydrogen.