Clean Energy Finance Corporation (CEFC) and Resource Capital Funds (RCF) will work together to fast-track decarbonisation in the mining industry.
CEFC is a specialist investor owned by the Federal Government that invests in clean energy to support Australia’s journey to achieving net-zero.
The company will invest $US75 million ($117.3 million) in RCF – a private equity firm with a mining portfolio worth $2 billion – to drive decarbonisation in Australia, with lithium, nickel and copper among the commodities named.
This year has been particularly challenging for lithium and nickel, with cyclically low prices being triggered by a supply surplus caused by increased cheaper lithium and nickel from countries like Indonesia and China, which have less stringent environmental, social and governance (ESG) standards.
A decrease in global electric vehicle (EV) sales also played a part in the decline, despite EV demand rising.
The $US75 million ($117 million) from CEFC will help critical minerals companies “capitalise on the opportunities offered by the clean energy transition, adopt more sustainable mining practices and reduce emissions well as helping decarbonise the critical mineral supply chain”.
“The world urgently needs a strong supply of critical minerals to power the clean energy transition,” CEFC director for WA and resources Jacqueline Lane said.
“From the lithium and nickel for batteries to the copper for transmission, we must secure these minerals quickly and sustainably.
“RCF is a highly experienced mining investment house. Our work with them will enhance environmental standards and reinforce the competitive advantage of Australian minerals in the global market with the potential to further develop onshore downstream processing infrastructure with financial discipline.”
There is also an option to devote a portion of CEFC’s investment to mining projects around the world to reduce global emissions.
Federal Climate Change and Energy Minister Chris Bowen welcomed the announcement, following the ‘Future Made in Australia’ legislation passing in the Senate last week.
“We know Australia has the potential to be a renewable energy superpower, and with our enormous mineral wealth, we can help the world make the switch to net-zero too,” Bowen said.
“Our ‘Future Made in Australia’ plan ensures we use our resources base to power the world while bringing jobs and wealth back home, especially in regional communities.”
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