Australia snubs 1st major post-Paris summit after killing renewables target

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ABU DHABI: Australia has chosen not to send any government representatives to the first major post Paris climate change conference, as new data confirms how the Coalition government has effectively killed the renewable energy target as an effective policy mechanism.

In 2015, the world invested a record $US329 billion in renewable energy. But in Australia, the RET – the country’s primary policy mechanism – has attracted just $15 million in investment in nearly two years.

The data, from Bloomberg New Energy Finance, confirms that since the Abbott government announced its review into the RET in early 2014, the scheme has been at a standstill.

That remains the case – even though renewable energy certificates have jumped to record levels of $74/MWh –  because utilities and financiers refuse to sign contracts, due to the lack of policy certainty and because they believe that the Coalition could change the target again.

Indeed, more than half Australia’s investment in renewable energy in 2015 (of $A4.1 billion) comes from households and businesses, who spent $2.2 billion in 2015 adding rooftop solar PV to their home and commercial premises.

bloomberg australia renewables

There has also been some $1.1 billion of large scale asset finance in 2015, but this due to activities outside of the Coalition’s control. Much of it was provided by the ACT government, and its successful reverse tender for large scale wind and solar.

The rest came from projects supported by two agencies that the Coalition government has tried to dismantle. Legislation calling for the Clean Energy Finance Corporation and the Australian Renewable Energy Agency has not been withdrawn, despite the Coalition’s stated contention that “we like renewables.”

That declared support does not extend to sending ministerial, or even department level representatives to the International Renewable Energy Agency (IRENA) summit in Abu Dhabi this week.

While 58 countries are sending their energy, environment or other senior ministers including France, Germany, and India, Australia is sending only staff from the local embassy. Under Labor, Australia was a co-chair of IRENA and sent its energy minister.

The summit is the first to be held since 195 countries, including Australia, signed on to an ambitious goal to limit global warming to “well below” 2C, and even to aim to cap the rise at 1.5C.

That will require dramatic action at a scale not seen before. IRENA, the hosts, says the summit will discuss the road from Paris, the energy transition from fossil fuels to renewables and the transformation of the power sector.

The summit is also attracting more than 1,000 delegates from more than 150 countried. It will be followed by the World Future Energy summit, featuring leading financiers and renewable energy companies and utilities, and some 30,000 delegates. But again, no Australians.

BNEF said that clean energy investment in Australia is languishing at levels not seen since the RET was expanded in 2010.

Even with the ACT government program, and the initiatives supported by ARENA and the CEFC, Australia ranks just 18th in the world and trails countries such as Belgium (17th, $US870m), Thailand (15th, $US1.05 billion) and Morocco (12th, $US2.02 billion).

BNEF says Australia needs at least $A3.6 billion in large scale investment each year to reach even the scaled back renewable target of 33,000GWh.

bnef investment globalBNEF’s bleak assessment of Australia’s large scale investment contrasts with the surge in investment in China, Africa, the US, Latin America and India in 2015.

This surge was despite further declines in the cost of solar photovoltaics, meaning that more capacity could be installed for the same price; the strength of the US currency, reducing the dollar value of non-dollar investment; the continued weakness of the European economy, formerly the powerhouse of renewable energy investment; and perhaps most significantly, the plunge in fossil fuel commodity prices.

Michael Liebreich, chairman of the advisory board at Bloomberg New Energy Finance, said: “These figures are a stunning riposte to all those who expected clean energy investment to stall on falling oil and gas prices.” Said Michael Liebreich, chairman of the advisory board at Bloomberg New Energy Finance.

“Wind and solar power are now being adopted in many developing countries as a natural and substantial part of the generation mix: they can be produced more cheaply than often high wholesale power prices; they reduce a country’s exposure to expected future fossil fuel prices; and above all they can be built very quickly to meet unfulfilled demand for electricity.

“And it is very hard to see these trends going backwards, in the light of December’s Paris Climate Agreement.”

The biggest projects financed last year included a string of large offshore wind arrays in the North Sea and off the coast of China. These included the UK’s 580MW Race Bank and 336MW Galloper, with estimated costs of $US2.9 billion and $US2.3 billion respectively, Germany’s 402MW Veja Mate, at $US2.1 billion, and China’s Longyuan Haian Jiangjiasha and Datang & Jiangsu Binhai, each of 300MW and $US850 million.

After asset finance, the next largest piece of clean energy investment was spending on rooftop and other small-scale solar projects. This totalled $US67.4 billion in 2015, up 12 per cent on the previous year, with Japan by far the biggest market, followed by the US and China.

Australia was however the 5th largest investor in small-scale PV in 2015 – spending $A2.17 billion – placing it ahead of Germany (6th,) but behind the UK (4th) and Japan (1st, $US31.67 billion).  

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  • lin

    Australians spent 2 billion on rooftop PV in 2015.
    The RET – the country’s primary policy mechanism, has attracted just $15 million in investment in nearly two years.
    The majority of Australians want us to be investing in renewables much faster than we currently are. Malcolm’s government needs to stop being lead by a small, vocal rump of ideologically blinded troglodytes, and reverse the policies of the disastrous Abbott years. Failure to do this will result in a significant loss of support for his government by the electorate. If we continue to experience record breaking hot and dry weather combined with a bad fire season, he may have a lot less time to fix his government than he thinks.

    • john

      Malcolm’s hands are tied because one step against the hard right and he will be gone again as he was before.
      He can not make any policy changes before he actually wins an election so can a have degree of ability to point the party in which every way he chooses.

      • Jane

        Yeah well I don’t think Australia can afford to give him that chance. Another 3 years of that mob and we will qualify as a 3rd world quarry

        • john

          We are actually a quarry for basic minerals of which we have put sfa into a wealth fund.
          As to a change after the next election I am not so sure.
          Perhaps if there is a change in the balance of the parties some change will happen atm I do not see that happening as Malcolm has some degree of support within the Australian Electorate.

      • lin

        Malcolm has a big lead in the preferred PM polls for the minute, and he has put the Libs into an election winning position. The majority of the party will not try to remove him while this continues to be the case. I am sure there were a lot of backbenchers who remember the sense of impending doom under Abbott.
        If Malcolm wants a crack at being Australia’s longest serving prime minister, he needs to take decisive action on climate change. More than 75% of Australians support this. Failure to act will see liberal Liberal voters drift back to the Greens.

      • Pedro

        I am guessing the likes of Solar citizens and other related NGO’s will be targeting pro FF seats fairly heavily in the lead up to the next election. Hopefully whatever the government, it will be rid of enough ideologically blinded troglodytes to actually come up with sensible climate policy

  • Miles Harding

    Excellent graph – it really shows the damage caused by our Abbott plague.

  • Andrew Thaler

    I’m happy to go over an represent Australia.. as one of the few private solar farm operator/owners.
    Yeah, like that would happen.

    • john

      Andrew perhaps as overseer status you may be able to look listen not speak..

  • Michael Rynn

    Global Growth in Clean energy investment is not exactly showing the sort of rates of increase , required to replace fossil fuel infrastructure. I would like to see comparative fossil fuel investment and subsidy figures. If we are serious about replacing fossil fuel energy, we need an order of magnitude ( around 10 times) more clean energy investment.

    • john

      Michael just have a look at the investment into Clean Energy versus Coal or Gas and as you will realise in fact more money is being tipped into Clean Energy go to the IEA: and they honestly give you the figures; and that is basically the Fossil Energy Spokesman.
      As you can see from their figures more money into RE than any FF as is happening now and will be the way forward.

  • Roger Brown

    Investment fell off a cliff (2014) , the abbott effect had kicked in , and took us back to 2009 , in chart 1 above . Investment then slowly trickled back in , with the Mal / Abbott/ IPA / Murdoch Liberal Govt. hand brake on. Too many old grey haired men with “Old Money” in Old Coal / Gas / Mining etc etc shares , seeing their share price falling off a cliff and won’t sell , so they give donations to LNP to save them .

  • Vernham

    No problem with renewables as long as they are cost efficient, effective and do no harm – the problem arises when people assume big money has nothing to gain from telling lies. When peoples health and welfare and the environment take not second place but last place. Yes invest in rooftop solar and shut down the greedy energy companies who have no conscience or morals.

    • john

      Your post says cost good effective no harm.
      Now something that says money nothing to gain from lies and then greedy energy companies.
      So summarise your post in factual context.
      1 RE good effective no harm
      2 Money greedy
      3 RE I guess
      Perhaps you should not be so student old mate.
      There is a transition taking place gradually at first then every more suddenly RE is going to be an every increasing part of the Energy mix.
      Some are going to be hurt, some are going to fight tooth and nails against this change look at what is happening in near west coast of USA.

  • Math Geurts

    Unfortunately, like Giles Parkinson, many Australians are only interested in rooftop solar, not in serious climate change solutions.

    • humanitarian solar

      No Australian’s are interested in environmental goals in synergy with social justice goals, meaning distributed generation shares a societies wealth, whereas centralised generation concentrates the wealth into the hands of a minority at the expense of the vast majority. Hence centralised approaches are flawed by not encouraging the economic development of the whole community.

  • Rob G

    Abbott wanted to be remembered as the ‘Infrastructure PM’, but when we look at his legacy, in time, he will be remembered as the ‘Destroyer of Renewable Energy Infrastructure’ and the main cause for sending Australia backwards.

  • humanitarian solar

    If half Australia’s investment in renewable energy came from houses and businesses in 2015, then my question is how can we enhance this part of the renewable economy that is working for 2016?