A Federal Government agency meant to fund export industries has been heavily focused on fossil fuels. 

Analysis by research non-profit Jubilee Australia shows Export Finance Australia (EFA) has spent about 80 times more money on fossil fuel projects than renewables in the last decade.

EFA is a federal export credit agency that is meant to finance Australian exporting companies and their potential buyers, including overseas projects.

EFA is self-funded and operates on a commercial basis under an independent board, but it is a statutory corporation wholly owned by the Commonwealth of Australia, is part of the Department of Foreign Affairs and Trade, and reports to Australia's Minister for Trade, Tourism and Investment, Dan Tehan. 

Between 2009 and 2020, EFA paid around $1.69 billion to the fossil fuel sector and related services - including for coal, oil and gas projects. In the same time period, it provided just $20 million for renewable energy projects.

EFA is exempt from most freedom of information laws, so the full extent of its loans are kept secret, but Jubilee’s analysis shows it has assisted fossil fuel projects including the Wiggins Island Coal Export Terminal ($94.2 million) and Santos’ Gladstone LNG project in Queensland ($254.7 million), the Ichthys LNG project off the West Australian coast ($142.33 million), and a Papua New Guinea liquefied natural gas project ($383.4 million). 

The analysis comes just a few months after Germany, France, Spain, the Netherlands, Denmark, Sweden and Britain committed to use their public export financing as “a key driver in the fight against climate change”, forming the so-called 'Export Finance for Future' coalition.

This group is applying new principles including reviewing finance for fossil fuels and assessing how to best phase that finance out.

Trade Minister Dan Tehan has distanced himself from EFA’s decisions. 

“EFA assesses all transactions on a case-by-case basis and does not favour certain types of projects over others,” he told reporters this week.

“Between 2015-16 and 2019-20, EFA financing of all energy projects accounted for less than five per cent of the total finance provided by EFA.”

Just over a fortnight ago, Mr Tehan announced forthcoming changes to legislation which could give EFA more ways to finance fossil fuel projects.

“As much of the world moves away from financing fossil fuels, Australia could be one of the few countries still willing to finance new fossil fuel projects,” says Luke Fletcher, executive director of Jubilee Australia.

“Over the last decade, more than a billion dollars of money backed by Australian taxpayers has gone to finance fossil fuel projects here and overseas. Some of the most significant projects have lost money or risk becoming stranded assets.

“This is a significant missed opportunity to make Australia a renewable energy superpower. We’re taking risks on old infrastructure instead of looking forward to the future opportunities.”

In addition, Jubilee says the $5 billion Northern Australia Infrastructure Facility (NAIF) could be increasingly used to fund fossil fuel projects. 

NAIF announced its first approval for a coal mine, a $175 loan for the Olive Downs coal project in Queensland on 1 July 2021. 

NAIF is not required to consider greenhouse gas emissions when lending to projects. Legislation passed in May allows NAIF to fund projects directly, without checks by State or Territory governments.