News | 7th Nov, 2011

Banks shy away from proposed power station

Monday, 7 November 2011
Louis Nelson, Latrobe Valley Express

Plans for a proposed Latrobe Valley power station have suffered another blow, with a number of international banks announcing they would not fund the project.

HRL's proposed dual-gas fired power station, which would be powered by innovative technologies to reduce emissions from brown coal combustion, has not met emission standards of banks seeking to invest in low-emitting generation technologies.

Internation al banks Unicredit, BNP Paribas, HSBC and Rabobank have indicated the proposed plant's emissions would exceed requirements of "internal investment policies on energy", as reported in the Australian Financial Review last week.

This development is the latest in a string of blows for the HRL, which is currently fighting a decision by the Environment Protection Agency to reduce the proposed 600 megawatt version of the plant to 300 megawatts .

Prime Minister Julia Gillard indicated the project had until 31 December to meet "project milestones" in order to secure $100 million in Federal Government funding, while Australia's top four banks indicated in May they would not fund the project.

A Westpac spokesperson told The Age at the time the bank did not consider it a "clean coal project", and its focus was to support projects that use "cleaner and more efficient" technologies.

HRL has yet to indicate whether it has secured any alternative funding for the project, which is estimated to cost $1 billion for the 600 megawatt version.

HRL did not respond to calls from The Express.

Environment Victoria safe-climate campaigner Victoria McKenzie-McHarg said the banks' reluctance to fund the project signalled the wider business communities' acceptance of the importance of green technologies.

"It's great to see international banks recognising the financial area to invest in is genuine green energy technologies; HRL is far more polluting than any of the new energy proposals around the world," Ms McKenzie-McHarg said.

Latrobe City Council would not comment on HRL's funding difficulties.

The council had previously stated it saw the project as a vital component in the region's transition to a low-carbon emissions future.

Environmental groups are also challenging the EPA's decision in Victorian Civil and Administrative Tribunal, which opposed the reduced approval outright.

Hearings recommenced last Wednesday at VCAT with the conclusion of opening statements.

Evidence and cross examinations are expected to continue throughout the week, with the hearing expected to last another two weeks.



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