A real light at the end of the tunnel or just another oncoming train for Australia’s renewable energy industry?
The Abbott government announced last week it was prepared to accept a renewable energy target of 33,000 gigawatt-hours (GWh) by 2020; a target that industry is also prepared to accept – albeit grudgingly. It’s a major step down from the current legislated target of 41,000 gigawatt hours.
At a meeting in Melbourne on Friday, Industry Minister Ian Macfarlane, Environment Minister Greg Hunt and opposition environment spokesman Mark Butler agreed in principle on the revised target.
However – surprise, surprise – a couple of devils appeared in the detail.
The government has dug its heels in on the two-yearly reviews of the scheme, which the industry had been given repeated assurances would be removed. It’s these continual, expensive and pointless reviews that undermine investor confidence. The current review has resulted in a collapse in local investment for new large-scale renewable energy projects such as solar and wind farms.
The Clean Energy Council (CEC) has said yet another review next year – as the current review has dragged on so long – could be a “death warrant” for the industry.
The CEC is also concerned about the appearance of the inclusion of native forest wood waste under the Target.
“It is important these matters are resolved quickly and that a clear bipartisan deal is landed as quickly as possible, to restore the bipartisanship necessary for the sector’s future,” said Clean Energy Council Chief Executive Kane Thornton. “A messy negotiation on the floor of Parliament will not give investors the confidence to commit billions of dollars to new renewable energy investment.”
While the issue of the reviews and wood waste are the primary concerns of the CEC; the Australian Solar Council is spitting chips generally – and not just woodchips.
Early last week, the Australian Solar Council said the 33,000 GWh target would favour wind power.
“The slashed target will quickly be taken up by wind alone By 2017-18 when ‘big solar’ is competing at scale there will be little space left,” Mr Grimes said.
“This is a poor outcome for Australia. It locks us into a single technology and ignores Australia’s solar potential.”
Grassroots group Solar Citizens is also generally unhappy with the lower target.
“This massive scale back of the RET could mean up to a $45 billion revenue windfall to the big power companies over the next 15 years and now it looks likely that households will continue to pay more,” said Solar Citizens’ National Director Claire O’Rourke. .
“The vested interests of the power companies have received special treatment from the Abbott Government at the expense of ordinary Australians who want more solar and renewable energy, not less.”
The Greens have also objected to biomass being included under the proposal.
“Including biomass in the RET would just continue the devastation of our native forests and prop up big corporations at the taxpayers’ expense,” reads part of a statement from the party.
RenewEconomy’s Giles Parkinson had a strong reaction to news of the latest gotchas.
“The appalling shenanigans over the renewable energy target stand as one of the most cynical examples of policy sabotage in Australia. And yet, even as a deal is purportedly struck to consign $5 billion of potential investment to the dustbin, the policy bastardry continues,” he said.
The CEC’s Kane Thornton is remaining hopeful about the time ahead.
“With the Federal Government and the Labor Party so close to a common position, we are hopeful that common sense will prevail and the two major parties will be able to sit down and quickly resolve this crisis. No-one in the industry is happy about the prospect of a reduced target for large-scale renewable energy, but it is time to put this issue to rest.”
