“The government also worked with the CEFC, who wanted to collaborate on the implementation of the HBS [Home Battery Scheme] to provide a financing option to enable people to more easily pay for the difference between the cost of a battery system and the subsidy,” the email from the public servant to a clean energy lender states.
“CEFC selected RateSetter to manage their $100m investment in the HBS via RateSetter’s Lending Platform.”
The NSW government launched a pilot program on Friday called Empowering Homes, which will be jointly delivered by the CEFC and RateSetter and offer loans of up to $14,000 to households for rooftop solar and batteries.
Renewable energy finance lenders were questioning at the weekend the procurement processes around the program, saying there should not be only one delivery partner.
This comes after a similar program was announced by the South Australian government in October 2018 between the two organisations which also did not go out to tender.
Under both schemes, the CEFC provides finance for loans that are administered by RateSetter.
In 2017, the CEFC gave a $20 million seed investment to RateSetter, which at the time specialised in car lending. Other lenders have applied for similar funding arrangements but have been rejected.
Earlier this year, RateSetter revealed it was considering an initial public offering of more than $300 million.
Community First Credit chief executive John Tancevski said his organisation had been inquiring about how to participate in the NSW trial and Friday’s announcement came as a surprise.
“The announcement came with no involvement, no other industry input – it was just announced with CEFC and RateSetter,” he said.
“We don’t understand what problem they’re trying to fix with financing these kinds of products.
“If they are playing in this space, surely they should provide a fair playing field … Why is there an exclusive arrangement with RateSetter?
“Why isn’t [there] an open process where you could pick any provider. There’s no point in limiting the market.”
Australian Finance Industry Association chief executive Diane Tate said the lack of consultation had created a perception that the CEFC was not being transparent.
“Renewable energy financiers expect decisions around projects and investments to be fair, and it seems that greater accountability and transparency is needed to ensure competition in the renewable energy market,” she said.
“We’re just asking the CEFC to be more transparent around how it is making these decisions and taking into account a broad set of things.
“It is encumbent on CEFC to engage with current partners or potential partners to make sure every one has confidence in the process because that will mean more will engage with the process, and that will build the market.”
Flexigroup chief executive Rebecca James said her company wanted to see a “level playing field and a competitive marketplace for renewable lending”.
“With regard to the Empowering Homes initiative, we’d be keen to understand the appointment and selection process that was followed here given the importance of a fair, open and transparent market for the benefit of consumers,” she said.
The CEFC said RateSetter was not an “exclusive partner” on either of the programs.
“The CEFC works with multiple financiers. State government procurement decisions are a matter for the individual government,” the CEFC said.
RateSetter chief executive Daniel Foggo said the company was proud to work with the CEFC to deliver the two schemes.
“We think RateSetter’s strong record of offering low-rate regulated loans sets us apart from our competitors,” he said.
Anthony is foreign affairs and national security correspondent for The Sydney Morning Herald and The Age.