Turning green to gold, Australia has to make its own luck in the race to renewables

It seems that Australia’s a-ha moment has now arrived in the clean energy transition.

It’s a moment in which the country realises that having natural ability alone doesn’t make you a winner.

This is evident from the slow progress that we are making against our goals to reach 82 per cent renewables by 2030, and to secure the massive investment that will be required to become a renewable energy ‘superpower’.

We have world-beating solar and wind resources. But investment in large-scale renewables is declining, not accelerating.

We have 40 per cent of the global pipeline of large-scale renewable hydrogen projects. But for now, they are for the most part simply that – in the pipeline.

And we have huge potential to develop new green, energy intensive industries in minerals and metals processing – but we are yet to see commitments to new green iron refineries and minerals processing plants.

Contrast this with what is currently happening in the United States.

At the one-year anniversary of the passing of the Inflation Reduction Act in August 2023, the American Clean Power Association tallied that over $US270 billion of private capital had been committed in clean economy investments, including 185GW of new clean energy project capacity and 83 new or expanded manufacturing facilities.

So global investment is flowing, but it is to those markets with investment attraction strategies.

And in the face of rising global competition for capital, supply chains and skilled workers – the IEA says that the world will need to triple renewable energy capacity by 2030 – competition will only intensify in coming years.

So, the message is clear – we will need to make our own luck.

That’s why today, the Clean Energy Council has released its Power Playbook, a suite of 45 recommendations to the federal government, to help it develop an integrated and coherent strategy for success.

The first thing that must be recognised is that low-cost renewable energy is the foundation of our successful transition to a net-zero economy, and so we must prioritise the full decarbonisation of the electricity sector by 2035.

This will need to be backed by deliberate policy that can ensure we achieve 82 per cent renewables by 2030, including a long-term national policy mechanism to support large-scale projects which the industry can bank on.

An increase to, and extension of, the Renewable Energy Target – which has proven both efficient and effective in the past – is the CEC’s preferred approach.

We are also calling on the federal government to establish rooftop solar and storage targets for 2030 and 2040 and extend the Small-scale Renewable Energy Scheme out to 2040 to support behind-the-meter batteries.

The Playbook also calls for the development of a National Clean Energy Supply Chain strategy. We can’t just will entire industries and supply chains into existence, we need to plan for them.

More broadly, the Power Playbook calls on the government to develop a Renewable Energy Superpower Masterplan which articulates Australia’s vision as a global clean energy leader, identifies the priority markets we will pursue as a nation, and guides the allocation of public and private investment and resources.

This integrated plan has to be backed by substantial funding that can attract the investment in renewables and green value-added commodities.

That’s why the Clean Energy Council is calling for the federal government to allocate $100 billion over 10 years to boost and retain Australia’s international competitiveness as a producer of renewable energy and green value-added commodities.

This number sounds huge – but it is proportionate to the massive task in front of us, and we expect that just like the Inflation Reduction Act, it would in turn unleash hundreds of billions of dollars of private sector investment.

The clock is ticking on our renewable energy target for 2030, and on our national emissions reduction target which depends on the success of the clean energy transition.

And so, we are looking to the Australian government to urgently begin putting in place the policy we will need to go for gold.

Make no mistake, this is a race.

As any athlete will tell you, natural gifts alone are wasted without determination and hard work.

It isn’t enough for us to offer our natural ability to the world.

We need to plan and train like we mean to win.

Anna Freeman is policy director, decarbonisation at the Clean Energy Council