The Clean Energy Council has warned that a so-called ‘real’ 20 per cent Renewable Energy Target (RET) would be a broken promise by the Federal Government that would lead to the decimation of the renewable energy industry and drive up power prices for consumers.
Acting Clean Energy Council Chief Executive Kane Thornton said the Federal Government’s pledge to reduce the Large-scale RET to a so-called ‘real’ 20 per cent was a death warrant for large sections of the industry, and would destroy the value of both future and existing investments.
“Over $10 billion worth of investment has been made in large scale renewable energy projects, and those investments were made based on the legislated 41,000 GWh target,” Mr Thornton said.
“The legislated policy provides the revenue to underpin the investments in renewable energy projects out to 2030, but this revenue would collapse if the RET is cut, smashing the companies which invested behind the policy based on its long-standing bipartisan support.
“A substantial reduction of that target to around 27,000GWh, as proposed by the government today, would equate to a 64 per cent cut in future investment and effectively devastate the renewable energy sector.
“The Renewable Energy Target legislation that has been supported by all political parties for over a decade is explicit about the 41,000GWh target, and the Coalition re-stated its commitment to it in the lead up to the recent election.
“Moving the goal posts so significantly on investors would result in massive asset devaluation, job losses and business closures, and send a signal to international investors that Australia is closed for business.”
Mr Thornton said the legislated target was projected to unlock $14.5 billion in large-scale renewable energy investment, and reducing the target as proposed by the government today would lead to a 64 per cent drop in the amount of new large-scale renewable energy required.
“This would mean the many exciting opportunities for solar farms, hydro power projects, wind farms and renewable energy projects in sugar mills would go begging,” he said.
“The analysis completed for the Warburton review of the RET shows that any reduction to the level of the target would result in higher power bills for consumers, as it would reduce competition in the energy market and lead to the use of more higher-priced gas-fired electricity.”
While increasing exemptions for the RET for other industries will transfer cost to other electricity consumers, the analysis shows that a corresponding reduction in the target will only further raise power prices for other consumers. This would equate to a double hit for power bills.
Clean Energy Council Acting Chief Executive Kane Thornton said the government needed to clarify its position on solar power, noting that Minister Macfarlane alluded to potential changes to the Small-scale Renewable Energy Scheme.
Please contact Mark Bretherton at the Clean Energy Council on 0413 556 981 for more information or to arrange an interview.