It’s becoming even clearer why Big Energy in Australia want the Renewable Energy Target gone; or at least gutted.
According to modeling by Jacobs; even just reducing the national Renewable Energy Target (RET) would generate $10 billion in extra profit over the next 15 years for coal and gas-fired power generators – and households and businesses will pay more for their power.
Jacobs states reducing the large-scale RET in the way some power companies have recommended would net Energy Australia $1.9 billion in extra profit between 2015-2030 and Origin Energy would rake in $1.5 billion.
But there’s more – AGL’s extra chunk of change would be significantly boosted to $2.7 billion if its goal of buying government-owned Macquarie Generation succeeds.
The sting in the tail of this mega-profit bonanza will be borne, as always, by electricity consumers and the environment. Wholesale prices will rise an average 15 per cent and retail prices 2.5 per cent by 2030. The latter doesn’t include the inevitable price hikes in relation to network costs, which make up a good chunk of a bill.
Jacobs also state $8 billion in new renewables investment would be lost and Australia’s electricity related emissions would balloon by an extra 2 million tonnes a year by 2030 under the reduction scenario.
Jacobs’ modeling was carried out for the Climate Institute, Australian Conservation Foundation and WWF-Australia. The full report can be downloaded here (PDF).
While the Abbott Government may have its sights set on disemboweling the RET; if it should do so it would be at great risk. Many Australians are passionate about renewables and an overwhelming majority of submissions to the Renewable Energy Target Review were in support of the RET. After the black eyes the Government has worn over the recent Budget; treading on the RET could be the proverbial straw.
Still, it wouldn’t be the first time a government has acted in opposition to the will of the people and defied logic – a good reason for perhaps going solar now and taking advantage of the thousands of dollars in incentives while they are still available. For example, 5kW solar power systems can attract up to $3,120 in subsidies depending on installation location.