It's the report Australia's clean energy industry has been dreading for months.
A government-commissioned review of the renewable energy target (RET) has finally been released, and supporters fear the future is looking bleak for the bipartisan climate change policy.
The review panel has recommended amending the scheme by either closing the large-scale component to new investors like wind farm operators or by setting targets based on electricity demand.
The clean industry sector has railed against both ideas, warning it would gut future investment in renewables in Australia, damage the $10 billion already committed and put 21,000 jobs at risk.
Clean Energy Council CEO Kane Thornton said it would only serve old-coal generators well past their use-by date.
“These recommendations would stop renewable energy in its tracks, stifling competition within the Australian energy market and ultimately disadvantaging electricity customers,” he said in a statement.
The wider industry has also warned of a sovereign risk issue if a message is sent globally that Australia is not open for business.
Environment Minister Greg Hunt appeared to reject the “grandfathering” idea – that is keeping the RET until 2030 for existing investors in wind, solar and hydro-power but shutting out any new entrants.
He claimed that wouldn’t deliver enough renewables by 2020 but increasing targets in line with electricity demand would get closer to the promised 20 per cent.
“We have a long-term commitment to renewable energy in Australia but it’s about finding balance,” he told Sky News on Thursday.
If left unchecked the RET is forecast to achieve a 26 per cent share of the market by the end of the decade, due to falling demand for power.
Several critics took aim at review chairman Dick Warburton, a known sceptic of man-made climate change, claiming his findings were always going to be distorted.
“This is a report written by climate change deniers, for climate change deniers, and it shows,” Labor’s shadow climate change spokesman Mark Butler said.
Greens leader Christine Milne called the report “climate denier drivel” before tossing it in the bin.
The review acknowledged the policy had led to renewable energy capacity almost doubling in Australia and overall it was exerting some downward pressure on wholesale power prices.
Critics – including Prime Minister Tony Abbott – have blamed the scheme for helping drive up power prices.
But the review panel said the RET was a “high cost approach” to reducing emissions when cheaper alternatives were available.
It also recommended either phasing out or scrapping entirely subsidies for household solar power systems – an option slammed by the rooftop PV industry.
Any changes to the scheme will have to run the gauntlet in the Senate – no easy task.
Labor, the Greens and the Palmer United Party have vowed to oppose any changes to the scheme and they hold power in the upper house.
WHAT ELSE WAS SAID ABOUT THE REVIEW:
- “The review underlines that the RET is simply an old fashioned industry subsidy.” – Minerals Council of Australia
- “The Warburton Review would kneecap Australia’s energy and climate policies.” – The Climate Institute
- “Support for the renewable energy sector is now redundant as it is now a mature industry in Australia and it needs to stand on its own feet.” – Australian Chamber of Commerce and Industry
- “Responsible governments support investment in smart, clean industries. They don’t prop up the polluting industries of last century” – Australian Conservation Foundation
By Nick Perry