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RET is failing in driving wind & solar investment


Source: AFR, 10 March 2016

Less than a tenth of the wind and solar generation capacity required by the Renewable Energy Target this decade is under construction, which could force the Turnbull government to renegotiate the controversial scheme with the opposition.

Major shortfalls under the cross-subsidy scheme loom as early as next year. Electricity retailers have to pay a penalty of about $93 for every megawatt hour by which they miss target.

A subsidy of nearly $80 a megawatt hour – on top of the $40 to $60 generators are typically paid in the National Electricity Market – has not been enough to drive more wind or solar farm investment.

Only 532 megawatts of new wind and solar projects are under construction, Bloomberg New Energy Finance says. Some of this has been bought by the ACT and won't be available to meet RET targets.

"At the very least, 1 gigawatt [1000 megawatts] of new projects need to obtain financing this year to demonstrate that the system is working, although much more is needed to meet the target."

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