Coalition draws lines for start to negotiations on Renewable Energy Target’s future

The Coalition has come out swinging–albeit not as furiously is it might have–in negotiations over the future of the Renewable Energy Target. Key to the Government’s initial position on the scheme are the proposals that the 2020 target be reduced to a ‘real 20%’ and that emissions-intensive industries be exempted from their RET compliance obligations.

Also noteworthy–and apparently thrown in as bargaining chips–are proposals to leave unaltered the portion of the RET supporting small-scale solar (the Small-scale Renewable Energy Scheme or SRES) and the cessation of 2-year reviews of the overall scheme, which leave the program vulnerable to changes in government and political shifts.

The details of the announcement reveal just how much the Coalition’s position on the RET appears to have shifted since the program’s future came into question as the Abbott government assumed power last year. Initially, the Government appeared prepared to consider measures as extreme as eliminating the Howard-era, bipartisan scheme altogether; the review of the scheme under businessman Dick Warburton–which openly considered closing the scheme to new entrants–did nothing to quell the fears of renewable energy supporters. The Government has since distanced itself rom the controversial report.

The Australian Solar Council, in a press release responding to the announcement of the Government’s starting line, attributes the shift to the persistent, vocal efforts of renewable energy supporters to raise awareness of what was at stake. The Solar Council itself headed up a nation-wide campaign, executed in tandem with renewable energy advocacy groups like 100% Renewable Energy and Solar Citizens, which is credited as having bolstered support for the scheme among the public and politicians.

The current 20% target appears to be the biggest bone of contention for the Coalition and its supporters. As overall electricity demand has unexpectedly fallen across Australia in recent years, the current 20% target, based on electricity demand forecasts that have not eventuated. Should a ‘real 20%’ proposal eventuate, the target would be slashed from 41,000 gigawatt-hours (GWh) by 2020 to around 26,000GWh–a 60% reduction.

The government, incumbent utilities and heavy industries have used this fact to argue that the RET should be reduced, while opponents of such a readjustment say that such a change would further undermine investment certainty and kill jobs. The Opposition has already pledged its support for an unaltered RET, and any legislative attempts to change the scheme look unlikely to succeed with the current Senate numbers.

Opposition leader Bill Shorten was emphatic in his party’s support for the RET as-is: “The government say they want a real 20 per cent, I call it a fraud 20 per cent, a fake 20 per cent. The truth of the matter is that renewable energy is part of our energy mix. It’s had a great benefit for a whole lot of consumers.”

He continued,”We’ve seen thousands of jobs created…and we’ve seen billions of dollars of investment. The real damage that this government’s doing in renewable energy cannot be overstated.”

© 2014 Solar Choice Pty Ltd