The Australian Federal Government has decided not to implement a Clean Energy Target (CET) which is likely to result in a substantial slowdown in new clean energy investment.
This in turn means that power prices will keep rising and voters will continue switching off, the Australian Clean Energy Council (CEC) said today. Clean Energy Council Chief Executive Kane Thornton said the industry was disappointed by the decision to drop the CET.
“The Clean Energy Target was the best opportunity in years to lock in the long-term bipartisan energy policy needed to encourage investment in cleaner energy while improving system reliability and pushing down power prices” Mr Thornton said. “We are obviously waiting to see more detail on the policy later today, but media reports today suggest the new policy would result in a substantial slowdown in levels of investment in clean energy”.
Mr Thornton added that any new policy must have long-term bipartisanship support to underpin investment confidence. This had remained an elusive but essential ingredient to underpin new investment in energy generation. The effectiveness of the Renewable Energy Target is due to the broad political support it has managed to attract and retain over a long period of time. A company which is thinking about investing in a project worth hundreds of millions of dollars needs to have confidence the goal posts won’t be moved halfway through the game. The support of both major parties continues to be an important factor for any new policy.
As the New South Wales Government has noted, the state’s old coal and gas power stations struggled to deal with the heatwaves at the beginning of the year. The CEC believes that energy storage and demand management can provide much-improved reliability at times of high stress compared to the current system, but many people will be watching the final policy settings very closely. The industry intends to continue pushing the Government for the energy policy that most Australians agree is necessary.