New legal advice, sought by The Australia Institute Climate & Energy Program, suggests the Underwriting New Generation Investment Program is unconstitutional and lacks the legislative basis to proceed.

Key points

· Legal advice received from Fiona McLeod SC and Lindy Barrett on 15 February 2019 finds that Federal Energy Minister Angus Taylor does not have constitutional authority over electricity nor the authority to fund projects under the Underwriting New Generation Investment Program, as currently proposed

· The Government requires new or amended legislation to proceed and, without a legislative basis, the program is open to a High Court challenge

· The only existing avenue for such appropriation of funds would be via the Clean Energy Finance Corporation (CEFC) which restricts energy funding to energy efficiency, renewable energy or low-emissions technologies; excluding coal and gas projects

“This legal advice is very clear, the Government’s hasty, poorly-designed program to invest in new gas and coal power stations cannot proceed without legislative intervention by Parliament,” said Richie Merzian, Climate & Energy Program Director at the Australia Institute. 

“Energy Minister Angus Taylor is in such a rush to funnel taxpayer funds to new coal fired power stations before the election, he seems to have overlooked that he has no constitutional authority to do so.

“This is another blow to the Federal Government, that their signature program to fund electricity is destined for the shelf – along with the rest of the Government’s energy policies.

“This is a Government that has gone to great pains to avoid addressing climate change and energy together, so it is ironic that the only way for the program to proceed is through investing in renewables through the Clean Energy Finance Corporation.

“Almost every coal power station in this country was built with Government and taxpayer support and with the demise of the Government’s underwriting program, we may never see another built with taxpayer dollars again.”

The legal advice, sought by The Australia Institute, was received from barristers Fiona McLeod SC and Lindy Barrett on 15 February 2019.