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Green query on blue power

Just three weeks before last year’s State election, Alannah MacTiernan turned up for a Labor policy announcement at the Old Swan Brewery.

You might think there’s nothing unusual there.

But the policy announcement was about wave energy in Albany and she was standing for election for the North Metropolitan region.

And because MacTiernan wasn’t a member of the Opposition at the time — having walked away from her Federal seat in Canberra in 2016 — she had no portfolio responsibilities that would have required her attendance.

Labor leader Mark McGowan was there to announce a policy to turn Albany into “a renewable energy city” and the base for a wave power centre of excellence.

Some weeks earlier, he had been in the southern port releasing his Plan for Albany, part of which was to take $19.5 million budgeted for a gas pipeline from Bunbury and use it for a wave energy project.

“Wave energy company Carnegie Clean Energy has been identified by Mr McGowan as the most likely proponent of Labor’s wave energy project after demonstrating success with the technology off the coast of Garden Island,” the Albany Advertiser reported.

And sure enough, when McGowan announced his policy at the Old Swan Brewery, he said Carnegie would partner with the University of WA in the Albany wave energy centre of excellence if Labor won the election.

An astute observer might say that signalled Carnegie had a rails run.

But what interest was this to someone campaigning for North Metropolitan? MacTiernan was standing on the far southern boundary of her intended electoral region, but the policy was aimed at people 400km away.

MacTiernan this week confirmed she knew at that time she was a shareholder in a company called Clean Energy Investments, a wholly-owned subsidiary of Carnegie.

I asked in what capacity she had attended the policy launch:

“Ms MacTiernan was involved in announcements of projects right across the State — including the Port Hedland marina, the Kalgoorlie MRI and funding for IT and innovation in Geraldton,” her spokesman replied.

This issue has become pertinent because MacTiernan as Regional Development Minister had a responsibility to oversee Carnegie’s role in the Albany project — and the company is now in serious financial difficulties.

This week the Government agreed to pay a revised first milestone payment of $2.625 million to Carnegie despite its auditors on October 1 noting a “material uncertainty” about whether the company was still a going concern.

So how did MacTiernan become involved financially with Carnegie?

“Ms MacTiernan was issued Energy Made Clean shares in 2011 and 2012 as part payment for her role on the company’s board,” the spokesman said.

“These were converted to Clean Energy Investments shares in December 2016, when Carnegie Clean Energy acquired Energy Made Clean. Election commitments in Albany were developed before those shares were converted.”

Four days after Labor won the State election last year, MacTiernan divested her shares in the Carnegie subsidiary. I asked why:

“Ms MacTiernan donated her shareholding to the charity Leprosy Mission to avoid any conflict of interest in her capacity as a Minister.”

Ridding herself of a financial interest was one thing. But divorcing herself from any associations both personal and ideological is quite another.

Question: Did Ms MacTiernan consider that she had any conflict of interest attending that February event as an effective shareholder in Carnegie?

A: “No.”

Q: Were any of the people involved in the management of Carnegie Clean Energy personally known to Ms MacTiernan before that February function?

A: “As a State Minister, and as Federal member for Perth and shadow parliamentary secretary for WA, Ms MacTiernan had contact with a wide array of renewable energy companies. She had no personal relationship with any person from Carnegie.”

Q: Had Ms MacTiernan, prior to returning to the WA Parliament, ever promoted the interests of Carnegie with any member of the Labor Opposition?

A: “Prior to agreeing to nominate for State Parliament, Ms MacTiernan was involved in Labor’s campaign in Albany and had discussions on a range of potential election commitments. There was no connection at that time between Energy Made Clean and Carnegie Clean Energy.”

Q: Has Ms MacTiernan seen fit to declare a conflict of interest at any stage of her dealings with Carnegie Clean Energy as a Minister?

A: “No, because there was no conflict.”

MacTiernan says she had no part in the selection of Carnegie for the Albany project which went through “an open competitive tender process”.

“That tender process was run independently by the Department of Primary Industries and Regional Development — the Minister and her office played no role in evaluating the tenders,” the spokesman said.

“DPIRD negotiated the terms of a Financial Assistance Agreement with Carnegie.”

Just three days after the agreement was signed, Carnegie released to the stock market its auditor’s statement of “material uncertainty.”

“While that agreement was signed on September 28, it had been the result of some months of negotiation,” the spokesman said.

“It was agreed in-principle some time prior to the signing.”

Q: Does the Minister concede that Labor’s involvement with Carnegie in the Albany wave energy project is what is colloquially known as “picking winners”?

A: “There was an open competitive tender process for this project — as such, no.

“All governments have schemes to support research and development projects. The previous Liberal-National government provided funds to Carnegie for an earlier stage of their technology.

“The Federal Government is also supporting the wave energy technology development project, and has supported Carnegie previously.”

The political problem for Ms MacTiernan now that Carnegie’s fortunes have waned is that she appears to have been a booster for renewable energy projects.

Even though she shed her direct financial conflict of interest, the perception could arise that she lacked objectivity and detachment in overseeing the project given Carnegie’s emerging financial difficulties, which clearly didn’t happen overnight.

In her answers, MacTiernan said she “has supported exploring development of renewable energy technologies for at least the past decade”.

That enthusiasm now raises questions about her impartiality, especially when the renewables sector routinely demands access to government funding.

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