Could the Coalition turn RET towards large-scale solar?

In seeking to justify its push against wind energy, the creation of a “wind commissioner” and its dealing with the Senate cross-bench, the Coalition is trying to turn the renewable energy target into a sort of de facto large-scale solar scheme.

“What we’re doing there is very significant and we’re increasing the focus on large-scale solar,” environment minister Greg Hunt told radio last week.

But can Tony Abbott, an expert in arguing against things – the carbon price and wind energy being just two prime examples – actually argue in favour of something, and get investors to follow?

In the letter Abbott ordered Hunt to write to the back-benchers led by David Leyonhjelm, he promises to ask the CEFC to ensure “significantly increased uptake of large-scale solar and energy efficiency”.

Hunt has not yet written to the CEFC, but the government does indeed have the power to change the mandate of the institution to focus on solar. The CEFC could respond by offering concessional finance for solar projects, or even take an equity stake in a project (something it has avoided doing to date).

The CEFC – which has $10 billion at its disposal over five years – has so far allocated around one-quarter of the funds it has committed to wind energy projects, including the new Taralga wind farm and the fourth stage of the Portland wind farm, and the refinancing of the Macarthur wind farm.

Solar accounts for an equivalent amount, but almost all of this is in the financing of rooftop solar PV, mostly through power purchase agreements and the like.

But CEFC chief executive Oliver Yates recently gave an upbeat assessment of the prospects of the big solar industry, noting the forecasts by Bloomberg New Energy Finance that it could account for 40 per cent of the RET.

“We are seeing a continued global and domestic trend downward with utility-scale project costs,” Yates said. “We encourage the diversity of renewables within the energy supply system and expect solar to play an increasing part.

“The predictability of solar generation, relative ease of construction and low development concerns around Australia is making it an attractive option.”

© 2015 Solar Choice Pty Ltd

Giles Parkinson

Giles Parkinson regularly contributes unique content to Solar Choice News. Giles is the founder and editor of clean energy industry news service RenewEconomy. He is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the founding editor of Climate Spectator.
Giles Parkinson