The WA State Government has agreed to pay Carnegie Clean Energy its first milestone payment for the Albany wave energy technology development project, but has ordered the company to provide a comprehensive and detailed funding plan for their contribution to the project.
Following the resignation of long-standing Chief Executive, Mike Ottaviano, the State Government initiated further investigation into a dispute about the interpretation of the first milestone in the wave energy project.
After seeking out legal advice the State Government has agreed to pay Carnegie Clean Energy the previously negotiated first milestone payment of $2.625 million.
The State Government is satisfied that Carnegie has commenced site development activities and design works, and has complied with its contractual obligations.
However, the Federal Government’s proposed changes to research and development tax incentives have affected the company’s finances.
Minister for Regional Development, Alannah MacTiernan, said, “The Federal Government’s proposal to change R&D tax incentives, contained in their 2018-19 Budget, has threatened the bottom line of several Western Australian companies – from renewable energy to tech metals.
“These changes emerged after the State Government signed the funding agreement for the Albany wave energy technology development project.
“Given the circumstances surrounding the Federal R&D changes, the State Government is committed to protecting its investment and building safeguards in the project to minimise financial exposure.”
Consequently, the State Government will require the company to provide a comprehensive and detailed funding plan for their contribution to the project. The company will be given nine weeks to complete this plan.
Upon receipt of the plan, the State Government will then assess whether the company has the financial capability, in an altered Federal R&D tax incentive environment, to complete the project.
“We are committed to renewable energy research and development in the Great Southern, to drive jobs and economic benefits for the region,” Ms MacTiernan said.
“This project has the potential to advance wave energy technology that otherwise would have been developed overseas.”