Today we’re celebrating as the Government announced it would straighten out some of the problems with its Renewable Energy Target.
A key 2007 election promise from Kevin Rudd was to increase the Renewable Energy Target (“RET”). The RET was supposed to make sure 20% of Australia’s electricity came from renewable sources by 2020.
However, after waiting nearly two years for the government to introduce it, we ended up with a target so distorted by overlapping rebates and other schemes that the whole thing became a confusing policy mire. The RET was barely recognisable because of all the distortions.
Well-meaning government efforts to support rooftop solar and solar hot water created a rush towards these technologies. As a result, the market for renewable energy credits (which provide the financial support for renewables under the RET) became flooded. This caused the value of credits to plummet, making many larger-scale projects unviable. It also meant that precious little room was left for larger-scale projects to have a chance of being supported.
Finally this has been fixed. Small and large-scale technologies will each have their own part of the RET set aside. Now, the popularity of solar panels and hot water won’t eat in to the credits set aside to support large-scale projects.
Australia’s wind industry especially had been suffering because of the problems with the RET. The global wind industry managed to grow even faster in 2009 than 2008. But it was a different story in Australia. Australia managed to build less wind power last year than in 2008. Billions of dollars of investment was under threat, as well as thousands of jobs.
Greenpeace pointed out these flaws in the RET to the Government over a year ago, and again into a more recent review of the scheme. Having campaigned for many years to see a strong RET, we’re very relieved to see this issue fixed.
It’s important to remember there’s still a long way to go with renewable energy policy in Australia. Even if the RET was operating perfectly, 20% renewable energy is still well short of meeting Australia’s potential.
We need to be aiming for Australia to get out of polluting energy as soon as possible. Policies need to be introduced now to give us the best chance of achieving this goal.
The next step is to start moving renewable energy technologies over to feed-in tariffs. Feed-in tariffs treat each technology on their own merit and are the policy behind the renewable energy success story we call Germany.
Technologies such as large-scale solar, ocean energy and geothermal still have little to look forward to under the RET. They should be the first ones taken out of the RET and instead supported with feed-in tariffs. It will send them a clear signal over their future and allow industries and manufacturing capacity in these important technologies to develop locally.
We’ll get stuck into that on Monday morning. Tonight it’s time to celebrate some success.
