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Carbon millions squandered

une 17, 2012

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Up in smoke…

The Rudd government committed $400 million to set up the Global Carbon Capture and Storage Institute. Three years on, there is precious little to show for the money.

THE Australian-funded $300 million Global Carbon Capture and Storage Institute set up by former prime minister Kevin Rudd has squandered taxpayers’ money for negligible results, ex-staff say.

And according to a survey of the institute’s 190 members, which include businesses, governments and institutions from around the world, many were ”fed up with the lack of focus … and fast losing patience” with its work.

Undertaken in 2010, the survey, which has been obtained by The Sunday Age, found 31 per cent of all members believed the organisation was ”fast losing its relevance and must start to demonstrate greater value to members immediately”. Another 48 per cent said it had done a good job to set itself up but ”it’s important it now starts to achieve more”.

Description: Illustration: Matt Golding

Illustration: Matt Golding

The institute’s new chief executive, Brad Page, said it was now refocusing its approach, but conceded the original $100 million a year ”seed funding” given to the organisation – launched with great enthusiasm by Mr Rudd in 2009 to ”lead the world” in the greenhouse gas reduction technology – was too much for the fledgling body to manage efficiently.

”It’s actually impossible to spend that amount of money responsibly,” Mr Page told The Sunday Age.

Documents released under freedom-of-information laws show a staggering $54.25 million was spent on ”operational expenses” in the institute’s first two years.

Among those expenses were numerous first-class air fares for board members and lavish overseas trips for more than 15 of the institute’s Australia-based staff to attend meetings in France and Japan, where they stayed in five-star hotels and were catered for by top chefs.

But for all its high-powered meetings, former staff and industry observers say the Canberra-based institute has never had a clear focus, and this has led to millions of dollars being invested in overseas projects that have been of negligible benefit to Australia.

Mr Page is now trying to make the institute financially self-sufficient in readiness for when Australia’s generous ”seed funding” finally runs out in five years.

Since 2009, the institute has received more than $235 million – $122 million of which it has already spent and another $113 million of which remains in a bank account, beyond the reach of Treasury’s cost-cutting razor, according to information provided at a recent Senate estimates hearing.

The not-for-profit organisation has 78 staff, including nine permanent staff working overseas.

When it was established, a spokesman for Mr Rudd said the institute would not ”actually fund demonstration projects overseas” but instead would ”provide expertise … and research”.

Three years on, it is administering $65 million in contracts with institute partners. It has allocated $21 million to the Asian Development Bank, almost $20 million to the Paris-based International Energy Agency, and $10 million to the Clinton Foundation headed by former US president Bill Clinton, and given a grant to another body called the Climate Group, to ”advance” carbon capture and storage.

The Sunday Age believes there is deep concern about what Australia is actually achieving from these contracts.

Mr Page said the institute aimed to make sure each new project around the world did not repeat the mistakes of the last.

He said the money going to overseas projects built up the institute’s publicly available ”knowledge bank” about carbon capture and storage, but from now on the institute would commission specific research and would no longer fund projects on the ground.

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