WA renewable energy target sends investors the signal they need – at a critical time

Near Badgingarra, around 200 km north of Perth, construction has begun on the Parron Maam Wind Farm. At its peak, the 470 megawatt project will employ 400 construction workers.

Once complete in 2028, it will power around 200,000 homes and contribute around half a million dollars a year to the local community.

It’s not alone. Another 21 renewable energy projects are under construction across Western Australia, 12 of these supporting the mining industry and the other nine feeding into the state’s main electricity grid, the South West Interconnected System (SWIS).

These projects create jobs through construction and operation phases, and will put tens of millions back into their host communities over their 25-30 year operational lives, not to mention the billions of investment dollars flowing into the state.

Two things are driving this: WA’s excellent wind and solar resources, and the Cook government’s support for renewable energy.

Most of the SWIS projects under construction have been able to reach financial close due to contracts provided by the state-owned Synergy and Water Corporation.

But these projects alone won’t get WA there. More need to come online, and soon, if WA is to meet its 2030 state-owned coal power station phase-out timeline.

To get the private investment required, we need to send a strong signal to investors that new projects are needed. That’s why this Renewable Energy Target (RET) comes at a critical time for investment.

The Premier and Minister Sanderson’s announcement of a WA Renewable Energy Target of 75% for the SWIS is the green light investors have been looking for.

It provides greater certainty for capital to be directed into WA’s abundant wind, solar, and storage projects, creating a wave of new jobs and driving down wholesale power prices.

A renewables target gives investors policy certainty, which matters because Australian electricity markets are not without risk. In Queensland, planning approvals have been retrospectively withdrawn.

NSW and Victoria face uncertainty over coal closure timelines, and there are questions over whether new transmission lines to connect renewable energy will be delivered on time.

Lower risk means lower cost. More policy certainty lowers the cost of capital, making new generation and storage cheaper which ultimately flows through to power bills for homes and businesses.

A strong state target for renewable energy in the SWIS tells investors that WA is a stable environment to invest the billions required for the state’s energy transition.

Investors are ready and waiting, with over 10 GW of projects with development approval in the pipeline.

As our trading partners get more serious about climate change and the embedded carbon in their supply chains, Australian-produced green metals will become more valuable.

WA has the opportunity to capture more of this energy intensive supply chain, currently completed overseas, which would deliver a significant second wave of clean jobs and export earnings for the state.

The Mid West has been identified as a key region for green iron development. But this isn’t possible without the clean generation from wind, solar, hydro and batteries.

WA has climbed to the third most attractive state for clean energy investment in the Clean Energy Investor Group’s annual survey of investors, today’s RET
announcement strengthens the case for WA to rank even higher. With this target, WA is no longer on the sidelines; it’s ready to compete.

Richie Merzian is the CEO of the Clean Energy Investor Group