Blog Solargain

 

Finally… a deal over Australia’s renewable energy target has been reached.

Nearly two years after the Abbott Government first decided they wanted to reduce the RET, a bipartisan target has been agreed upon.

The renewable energy industry can now move forward with more clarity, certainty and confidence. While many renewable energy companies will agree that so much more can still be done to ensure a successful, sustainable future, a definitive RET provides a more helpful vision of the playing field for businesses and investors alike.

The New RET

After the 2013 election and RET review that soon followed (conducted by well-known climate sceptic, Dick Warburton), the Government originally proposed cutting the target to 26,000 gigawatt hours (from 41,000).

Meanwhile, Labor said that they would not go below a figure of 35,000 gigawatt hours.

A long-running debate ensued, with a deal finally written in stone during recent talks in Melbourne.

Here are the key takeaways from the agreement:

  • Australia’s new RET by 2020 will be 33,000 gigawatt hours
  • The Government has agreed to scrap regular reviews of the scheme
  • Trade-exposed industries are fully exempt from the target

It’s important to note that the very first bipartisan RET was 41,000 gigawatt hours.

So, while the 33,000 figure is considerably higher than the Abbott Government’s proposed 26,000 gigawatt hours, it’s had a hefty chunk taken out of it in comparison with the initial target.

As part of the agreement, the Government has abandoned a proposal to review the target every two years after opposition from the clean energy sector threatened a deal with Labor.

Instead, the Clean Energy Regulator will publish an annual statement showing progress towards the target and any impact on electricity prices.

What does this mean going forward?

While overseas investment in renewables has risen to all-time highs, investment in Australia has stalled.

This new bipartisan deal will hopefully clear the way for influential investment and interest back into Australia’s clean energy industry.

Clean Energy Council Chief Executive Kane Thornton said the deal would unlock up to $10 billion worth of investment, mainly in wind farms and large-scale solar projects.

‘Australia’s potential in renewable energy is massive,’ he said.

‘It’s been a challenging period with all the uncertainty, but with that coming to a close there’s a massive opportunity for Australia.’

The new RET also means that more than 23 per cent of Australia’s power will come from renewable sources in five years, providing some surety for the some 20,000 Australians working in the industry.

Solargain has met this latest news with careful optimism.

Though the solidified target will ensure greater opportunities within the renewable energy sector, ultimately more needs to be done to help Australia keep up with the rest of the world in clean energy stakes.

For now though, this is a (much needed) step in the right direction.

Solargain