CEC says wind and solar could add $50 billion of investment in Covid recovery

The Clean Energy Council has outlined its vision for a renewables-led recovery from Covid-19, that could boost Australia’s economy with tens of billions in new investment and create more than 50,000 new jobs.

The vision is part of a broader, global push for the massive disruption brought about by the unprecedented global pandemic to be used as an opportunity to take stock of the global climate crisis and accelerate the shift to low-carbon economies.

As RenewEconomy editor Giles Parkinson noted here, these same subjects will be the focus of Wednesday’s online Stimulus Summit, jointly hosted by RenewEconomy and the Smart Energy Council and featuring Queensland premier Annastacia Palaszczuk , four state energy ministers (both Liberal and Labor), and energy experts and analysts including Ross Garnaut, Anna Skarbek, Oliver Yates, Maria Atkinson and Simon Holmes à Court.

The CEC’s plan, called ‘A Clean Recovery,’ is based on Australia’s current pipeline of large-scale solar and wind energy investment, which the CEC says represents more than $50 billion worth of investment, most of it in some of the nation’s hardest-hit regional and rural communities.

Meanwhile, the investment would also serve to triple the amount of large-scale renewable energy installed in Australia, adding 30,000MW of new capacity to the existing 16,000MW currently installed across the National Electricity Market.

“This isn’t about a handout for industry when government is directing scarce taxpayer funding to other essential services and areas,” said CEC chief Kane Thornton on Tuesday.

“There is an enormous appetite for private investment in clean energy, that can be unlocked through smart regulatory reform, sensible energy policy and investment in the grid and energy storage.”

The CEC’s plan proposes the roll-out of a “package of initiatives,” ranging from a national home battery program, 100 per cent renewable energy commitments by government agencies, and the establishment of an electric vehicle charging network.

Other initiatives listed are far more complicated and big picture, such as building 21st century energy infrastructure, leveraging distributed energy resources, and developing the workforce of the future.

And others are clearly targeted at Australia’s less than supportive federal government, with directives to facilitate the continued investment in large-scale renewable projects, encourage the development of offshore wind energy, and prioritise smart market and regulatory reform.

But the main message from the CEC appears to be that a lot of the hard work has been done by industry – and some governments – and that the best thing we can do from here is not stand in the way of progress (and perhaps even encourage it a little).

This will be easier said than done, with years of policy uncertainty and, in turn, painfully slow-moving regulatory reform, taking their toll on investor confidence. Just this week, Greek-based international contracting group and renewable energy developer Ellaktor became the latest to quit the Australian utility solar market after posting huge losses across its portfolio.

The departure of Ellaktor and its Biosar business continues the rapid exodus from a solar sector hit by cost-overruns and lengthy connection delays, which has in turn resulted in contractors being hit by “liquidated damages” from project owners seeking compensation for lost revenue.

As RE reported here, almost every construction company has been hit in some way. One of the biggest, RCR Tomlinson, collapsed in late 2018 because of the growing impact of solar losses, while its biggest rival Downer has also quit the market, saying it was too hard. Another major contractor, Decmil, will only take on specific contracts rather than the overall EPC role.

But there is still plenty of optimism in the industry that could be converted into a huge wave of momentum without too much effort from governments and regulators.

“A Clean Recovery’ could build on the recent success of clean energy,” Thornton said. “Over the past three years, there has been over $20 billion worth of new large-scale wind and solar projects committed, equating to 11,149 MW of capacity and creating over 14,000 new jobs.

“There are currently hundreds of large-scale wind and solar projects that have been identified with planning approval and are well placed to proceed quickly.

“Bringing forward these projects could deliver over $50 billion of investment, more than 30,000 MW of capacity and more than 50,000 new jobs in constructing these projects, along with many more indirect jobs,” he said.