Warning on RET shortfall penalties
Source: The Australian, 30 May 2014
In a move that adds to pressure on the Coalition to make dramatic changes to the Renewable Energy Target, the Australian Energy Market Commission has revealed the target of 41,000 gigawatt-hours of electricity by 2020 'is unlikely to be met". If the target is not met, energy retailers will have to pay the government 'shortfall" penalties that could total $3.5 billion, according to modelling commissioned by the AEMC. This cost would be passed on to consumers.
Australian Energy Market Commission chairman John Pierce warns: 'We do not consider that the current policy is sustainable." In a submission to the RET review panel led by businessman Dick Warburton, Mr Pierce points to the situation in Britain, where an expected investment shortfall has forced the government to intervene in the market, and energy consumers will be subsidising the industry.