CCA releases renewable energy target paper
The Climate Change Authority has released its long awaited discussion paper reviewing the Renewable Energy Target (RET), outlining a number of key recommendations based on the response from the issues paper released in August.
"The challenge is to strike a reasonable balance between encouraging further investment in renewable energy – leading to ongoing reductions in greenhouse gas emissions – and the costs of the scheme to household and business consumers of electricity," said Authority Chair, Bernie Fraser.
The RET scheme dates back to 2001, and in its current form aims for at least 20 per cent of total electricity generation to be provided by renewable sources by 2020, including through the 31,000 gigawatt hours of electricity from the large-scale renewable energy target (LRET).
The major draft recommendation in the discussion paper is that the LRET (41,000 gigawatt hours) be retained in its present form – notwithstanding that on current projections of electricity demand this would represent around 25 per cent (rather than 20 per cent) of total electricity generated in 2020.
Mr Fraser noted that the scheme had operated for several years and significant investments had been made on the basis of the existing legislation, with more in the pipeline. Major changes to the policy which created further uncertainty – particularly at this time when the future of the carbon pricing is politically contested would seriously risk undermining investor confidence in renewable energy and the pursuit of lower emissions.
The discussion paper proposes a number of changes to improve the efficiency, transparency and flexibility of the RET scheme. These include:
- allowing emissions-intensive, trade-exposed industries to trade their partial exemption certificates to any liable party, not just their own electricity supplier
- providing opt-in arrangements to allow large energy users to better manage their own compliance costs
- converting the SRES clearing house to a 'deficit sales facility'
- expanding the number of organisations who may accredit small-scale installers, and
- canvassing possible cost containment measures for the uncapped SRES scheme.
The Authority will release a final report in December
The discussion paper can be found here