Invest $10 Billion in Renewables Annually or Fall Behind: Report

‘Australia needs to see a substantial increase in annual financial commitments to achieve the government’s target of 82 percent by 2030’: Clean Energy Council.

Solar panels are seen on the roof of The Australian National Maritime Museum in Sydney, Australia, on Aug. 14, 2019. Mark Metcalfe/Getty Images

Advocacy groups have called on the Australian government to ramp up its renewable energy investments to avoid falling behind other advanced economies in the global race to net zero.

The Clean Energy Council has released a strategic report detailing 45 recommendations to the federal government to ensure that Australia can achieve over 80 percent renewables by 2030 and become a renewable energy superpower.

The report (pdf) said the federal government needed to invest $10 billion (US$6.42 billion) annually for at least 10 years, or a minimum of $100 billion, in renewable energy to boost and retain Australia’s international competitiveness.

The council explained that major economies, including China, Europe, the United States, and India, were implementing existing and new renewable policies more quickly than expected and that Australia was at risk of falling behind.

The council cited the example of the Inflation Reduction Act passed by the U.S. Congress in August 2022, which provided US$369 billion for climate and “clean energy” programs.

“As a mid-sized economy at a significant distance from major markets, and a technology taker rather than maker, Australia will need to work harder to attract investment and supply chain interest,” the report said.

“The Australian government should commit to– as soon as possible, and no later than the 2024–25 Federal Budget–a nation-building Clean Energy Transformation Investment Package capable of boosting and retaining Australia’s international competitiveness as a producer of renewable energy and green value-added commodities.”

Decarbonisation of Australia’s Electricity System

At the same time, the council argued that the decarbonisation of Australia’s electricity system was a must for the country’s successful economic transformation in the coming period, saying low-cost, renewable energy was the foundation of a clean energy superpower.

It explained that Australia was not a low-cost power producer compared to Latin America and the Gulf states, despite the country’s natural advantages.

“Low-cost renewable energy is the foundation of a competitive Australia fit for the race to net zero,” Clean Energy Council CEO Kane Thornton said.

“Australia needs to see a substantial increase in annual financial commitments in the order of 6 to 7 gigawatts of new large-scale renewable projects from 2024, and the installation of approximately 3.5 gigawatts of rooftop solar per year through to 2030, to achieve the government’s target of 82 percent by 2030.”

The view overlooking wind turbines and farmland is seen at the Taralga Wind Farm in Taralga, Australia, on Aug. 31, 2015. Mark Kolbe/Getty Images

The council also suggested the government should target the full decarbonisation of the electricity sector by 2035.

Meanwhile, the Albanese Labor government has significantly boosted investments in renewables after it came into power.

Following the release of its 2023 budget, the Australian government has committed nearly $25 billion to renewable projects.

Prime Minister Anthony Albanese has recently hinted that his government will accelerate net zero policies after The Voice referendum concludes.

There have also been speculations that Labor would look at modelling the Biden administration’s Inflation Reduction Act.

Expert Says Australia Unlikely to Achieve Renewable Energy Targets by 2030

Despite the government’s and advocacy groups’ push for the net zero transition, energy experts believe that Australia is unlikely to attain its 82 percent renewable energy target by 2030.

An analysis by renewable energy consulting firm Nexa Advisory and global analyst Rystad Energy showed that renewable energy would, at most, account for 60 percent of the grid by 2030 under the current rate of progress.

The two companies cited growing resistance to a number of major high-voltage power lines as the main reason for the forecasted shortfall of Australia’s renewable energy target.

Similarly, Tony Wood, the director of the Grattan Institute’s energy program, said the heart of Australia’s slowing progress was delays in the construction of high-voltage transmission lines.

“On the current trajectory, we’re going to fall short,” he said, reported the Australian Broadcasting Corporation.

“The fact is we haven’t been building the transmission.”

Other problems with Australia’s net zero transition are rising technology costs and the lack of manpower.

A report by the Commonwealth Scientific and Industrial Research Organisation (CSIRO) and the Australian Energy Market Operator (AEMO) revealed that the capital costs of all technologies had increased by about 20 percent since 2021-22.

Energy experts said the rise in technology costs would make it more difficult for Australia to achieve its 2030 energy targets and also make electricity more expensive for customers.

Another government report indicated that Australia would need two million workers in building and engineering trades by 2050 despite the country’s insufficient training capacity and migration pipelines to meet the demand.