Renewable Energy Investments in Australia Hit Record Low

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Researched by Industrial Info Resources Australia (Perth, Australia)--Australia is reporting its lowest renewable energy investment since the launch of the government's Renewable Energy Target (RET). According to reports released by Bloomberg and other sources, as well as project spending data from Industrial Info, Australia has been facing a considerable decline in large-scale renewable energy investments since the start of the renewable energy target more than a decade ago.

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Renewable energy investments in windfarms fell 90% in the first half of the year, from the $2.7 billion that was invested during same time last year.

Australia's federal government is reviewing its renewable energy target, with the possibility of revising it. Concerns regarding the potential consequences of the review have led to uncertainty surrounding the future of several projects and a freeze on related active projects. In Victoria, the RET review halted $5.5 billion worth of projects. Origin Energy Limited (Sydney, Australia) delayed construction of the $900 million Stockyard Hill windfarm, while WestWind Energy (Gisborne, Australia) halted the start of construction at two of its windfarm projects: the 130-megawatt (MW) Lal Lal and 321-MW Moorabool.

Construction of a windfarm currently carries a bigger price tag than it would to build a comparable coal-fired power plant. But as the scale and experience increases, the costs are forecasted to fall in comparison with coal-fired stations within a few years.

RET modelling from consultants ACIL Allen, commissioned by the government, suggests that maintaining the current RET might increase overall industry costs by about $12.8 billion, but would result in lower long-term wholesale electricity prices and household electricity bills.

However, the government's announcement that it will lift the carbon tax is a blow to Australia's renewable energy investors, as scrapping the tax will further diminish the cost of producing electricity from fossil fuels.

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