RET issue just won't go away

Tim Nelson
Tim Nelson
10 February 2010

The Australian Financial Review today (10 Feb) ran a story on the Renewable Energy Target failing to incentivise the development of large-scale renewable technologies. Its worth having a look at (

As many of the readers of this blog know, AGL has consistently argued for a 4 point 'roadmap' to be adopted by State and Commonwealth Governments to solve this issue. The roadmap is supported by AGL Energy, Pacific Hydro, Vestas, Suzlon, Elgas, Epuron, The Gas Industry Alliance, Jemena and Siemens. The detail is outlined below:

The Australian energy industry believes existing policies measures with appropriate amendments can deliver a boom in investment and employment and contribute towards a significant reduction in greenhouse gas emissions over the coming decade. While each signatory to this document has its own policy position, the broad policy outline below represents a suite of solutions which are broadly acceptable.

Our plan is based upon four simple policy principles:


The Commonwealth has announced that from 2010, only gas (LPG or reticulated natural gas) or solar gas boosted hot water (SHW) will be able to be installed where gas is available. This policy will ensure that low emission SHW and gas hot water will displace electric hot water systems over the coming decade as existing hot water systems are replaced at the end of their economic lives[1].

Minor policy amendments required:

  • Removal of eligibility of all forms of hot water under the Renewable Energy Target with support being provided through energy efficiency schemes


There are energy efficiency schemes now operating in South Australia, Victoria and NSW. These schemes provide an additional source of revenue for companies that provide energy efficiency services.

Minor policy amendments required:

  • Amalgamation of state-based energy efficiency schemes into a single national energy efficiency obligation on energy retailers
  • Inclusion of all forms of low emission hot water (gas, LPG and SHW) as eligible sources of energy efficiency


There are various feed-in tariffs in place in different states which provide varying levels of support for household scale renewable photovoltaic solar generation (solar PV). The NSW and ACT Governments have the most generous schemes through a ‘gross’ feed-in tariff which provides installers of solar PV with additional revenue for all energy generated.

Minor policy amendments required:

  • All states to implement a feed-in tariff for residential solar PV; or
  • Inclusion of residential solar PV as an eligible form of energy efficiency; and
  • Faster removal of multiplier for small scale generation under the Renewable Energy Target


The expanded RET will underpin the delivery of the Government’s renewable energy commitments by driving investment in large-scale renewable generation.

Minor policy amendments required:


[1] Outside reticulated natural gas areas a policy to preference LPG boosted solar will assist in delivering the ability to extend the natural gas network.