What needs to happen to prove the LNP wrong, and the high renewables target right

As Federal Liberal Party Senator Maria Kovacic has astutely observed, the Australian people sent a very clear message at this election that they expect their government to have a credible plan for reducing emissions.

And not just at some point in a few decades time but “expeditiously.”  She noted that the Coalition’s nuclear and gas energy plan was a central element of an election campaign strategy that led to a “devastating” loss.

“Australians believe in climate change…and they didn’t see this [the Coalition’s nuclear and gas plan)  as a legitimate climate policy,” she stated. The primary concern people had was they could see this wasn’t going to deliver any kind of outcome for 15 to 20 years.”

While such observations are welcome, now is not the time for triumphalism in the clean energy industry. This industry faces a range of significant problems and challenges and this election has only really bought just three short years in which to address them. 

The Liberal Party may currently be rueing their decision to mount an election campaign demonising renewable energy as reckless. But the distrust of climate science and clean energy runs incredibly deep within the Liberal-National Coalition across its aging membership base and large section of its remaining members of federal parliament.

Furthermore, the National Party wing of the Coalition doesn’t seem to be having any kind of second thoughts about the energy policy they took to the election. Nationals Senator and aspiring party leader Matt Canavan is even suggesting that the problem was that the Liberal Party didn’t go hard enough and should have rejected commitments to lowering emissions outright.

So the clean energy industry must continue to work hard to prove the doubters wrong if it is to avoid continuing to be a political football.

Firstly. some context – while the industry has made incredible progress in the past ten years, we face significant difficulties achieving the Albanese Government’s target of 82% renewables by 2030.

The table below details Green Energy Market’s latest projections of renewable energy market share in 2030 by state and also across Australia’s two main electricity grids (the National Electricity Market or ‘NEM ‘and Western Australia’s South West Interconnected System or ‘SWIS’).

This is based on Green Energy Market’s Renewable Energy Market and Investment Review. It is built up from our database of renewable energy projects in operation, under construction and also projects not yet committed to construction but which have obtained a contract under either a power purchase agreement or government underwriting agreement.

Renewable energy market share and gaps to government targets

Source: Green Energy Markets Renewable Energy Market and Investment Review – Q1 2025. Note: WA target is derived from need to replace 2021 coal generation and also cover load growth between 2021 and 2030.

Provided the 11,700MW of projects under contract manage to enter construction in time, then we should get close to 64% renewables across Australia’s main grids. Interestingly, our numbers indicate that projects already in operation or construction will get us to the 54% renewables share which the  Coalition’s energy policy envisaged as the limit for this energy source.

So, a different election result could have meant the renewable energy industry downing tools for the remainder of the decade. However, if we want to reach 82% renewables then we need around another 18 gigawatts of projects to be built before 2030. That’s on top of installing rooftop solar at a rate consistent with AEMO’s Step Change scenario.

Given there’s a few years’ lead time involved in getting projects constructed, this works out very roughly to needing around 6,000 megawatts to be committed to construction each year over 2025 to 2027 (on top of the 11,700MW currently under contract but not yet committed to construction). 

One point of caution here is that our electricity demand numbers are based on AEMO’s Step Change Scenario. These include some reasonably bullish estimates for growth in electricity demand, particularly in South Australia. If history is anything to go by, electricity demand could be noticeably lower than these predictions and that would mean the amount of capacity needed to reach 82% could be lower than we’ve estimated.

To put this build rate into perspective the chart below illustrates large-scale renewable energy capacity committed to construction by year and fuel stretching back to 2012 (excludes rooftop solar and energy storage projects such as pumped hydro and batteries).

Overlaid on top in the dashed red line is construction commitments that need to come from the 11,700MW of capacity which is contracted but spaced out over three years. The black dashed line then shows the additional capacity commitments over and above contracted projects necessary to get us to 82%.

Source: Green Energy Markets Renewable Energy Market and Investment Review – Q1 2025

All up we need close to 10,000MW of project commitments each year. That’s a tough ask, particularly because it requires new transmission projects and these are moving at a snail’s pace, while their costs are blowing out at the speed of a hare. 

So what if we fell short of 82% by 2030? It’s important to recognise that the target is not embodied within legislation that imposes penalties on companies or costs on consumers if it isn’t achieved by 2030. It is problematic for meeting our obligations under the Paris Climate Agreement, but it shouldn’t be seen as some kind of fundamental failure of the renewable energy industry.

Another way to assess what needs to happen by the next election is to consider what it would take to make most people laugh at the claims made by National Party Senator Matthew Canavan, that renewable energy is pretty much useless.  

I suspect that passing 50% renewables before the next election is pivotal and, thankfully, that’s likely by 2027 based just on projects already under construction plus maintaining recent rates of rooftop solar installations. Also, while 10,000MW of annual commitments is a big step up from the past, 6,000MW per annum is effectively just three to four extra projects relative to what we managed in 2022.

Helping matters is that 3,900MW of that annual build is already accounted for in contracted projects. At such a rate we’d be on track to 70% renewables by 2030.  Hopefully the industry can do better than this, but such a development is likely to leave the electorate scratching their head at claims that only nuclear or gas can replace the role of coal generators.  

Another factor that will be helpful to inoculate the electorate against claims from people like Canavan will be a substantial base of households meeting almost all their power needs with solar plus batteries. 

According to Sunwiz data there were 72,500 household battery installs last year. To double that amount we’d only need to get every second solar system install to include a battery. At such a rate we’d be on a pathway to one million households with a battery system by 2030. That would be 1 million households providing their neighbours with first hand experience on why Senator Canavan is wrong.

This election result has given the renewable energy industry a three-year window to emphatically prove to the electorate that it can provide a viable replacement for coal in our electricity mix. The step-up required is achievable, but it won’t be easy.

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