Australia's Renewable Energy Review Sets Target Low

By Bob Burton

CANBERRA, Australia, January 19, 2004 (ENS) - In a rebuff to environmentalists and the renewable energy industry, an Australian government committee Friday dismissed the need to require that 10 percent of the country's electricity originate from renewable sources such as the wind.

The committee, chaired by former Northern Territory conservative senator Grant Tambling, backed the current legislative requirement that the equivalent of two percent of the 2001 demand for electricity be obtained from renewable sources by 2010. This target should be gradually increased in the following decade to double that level and increased again by 2030, the committee said Friday.

The renewables industry and a broad coalition of labor, community and environmental groups had backed the adoption of a 10 percent target by 2010.

The high level panel was established in March 2003 to review the Commonwealth's Mandatory Renewable Energy Target (MRET) legislation. The MRET requires the sourcing of 9,500 gigawatt hours of extra renewable electricity per year by 2010 through to 2020 – enough power to meet the residential electricity needs of four million people.

While the panel received over 5,000 submissions, most in favor of increasing the target, the committee opted to propose only cautious amendments to the MRET law.

Former Senator Grant Tambling headed the Mandatory Renewable Energy Target Review Panel. (Photo courtesy Government of Australia)

The committee notes in its report that under the current law it expects investment in renewables to stall from 2007 due to the lack of further growth potential in the market.

But the panel dismissed the adoption of a more ambitious target on the grounds that it “would unnecessarily induce investment in marginal projects and raise costs to electricity users without commensurate benefits, and risks locking the industry into an uncompetitive cost structure.”

Environment Minister David Kemp said Friday that the government remains committed to the MRET scheme, which he called "a world first in developing a legislated national renewable energy market based on an innovative system of tradeable certificates. MRET has been a cornerstone of the Australian government’s renewable energy strategy," he said.

After almost three years of operation, the review panel found that MRET is meeting its objectives, with industry taking up the challenge of delivering new renewable energy projects, and meeting its targets, Kemp said. Some 190 power stations that run on renewable energy have been accredited across Australia.

Dr. Karl Mallon, communications director for the Australian Wind Energy Association (AusWEA), welcomes retention of the MRET but believes that unless a more ambitious target is adopted, Australia will miss the chance to be a major regional manufacturer of wind energy equipment.

The Western Power Corporation wind farm at Albany, Western Australia consists of 12 turbines. (Photo courtesy Government of Western Australia)

“A lot of the companies will now be looking at the MRET legislation to see whether there is enough in there to justify installing manufacturing capacity in Australia, said Mallon. "The critical issue they will be looking at is how many wind turbines will they be selling a year and will that justify building a factory."

"Unfortunately," he said, "this is still a very slow ramp up and what we needed was a much more considerable throughput earlier."

While there has been a boom in the establishment of wind farms in Australia, largely because of the MRET law, wind power has attracted opposition from the powerful mining, oil and aluminium industries.

“They are powerful they’re is no doubt about it, and they have the ear of government,” said Catherine Fitzpatrick a Greenpeace climate changer campaigner.

Fitzpatrick describes the panel's low renewables target as “tragic.”

“It is insignificant," she said. "By 2010 growth in the power sector will have generated more greenhouse emissions than the small renewables target will have saved. There is nothing to stop the power sector from continuing to expand."

A reduction line producing aluminium metal at Comalco's Boyne Smelters Limited, near Gladstone, Queensland. (Photo courtesy Comalco)

“Rio Tinto has significant exposure to existing and emerging greenhouse gas reduction measures," the company complained in its submission to the panel, saying that its aluminium subsidiary Comalco faces a "direct liability under the current MRET scheme over the 20 years of operation is expected to be nearly $200 million.”

Rio Tinto does not believe supporting the development of renewables is a major priority for reducing greenhouse gas emissions.

“Support for renewable energy alone would not provide a timely and cost-effective climate change response, and in isolation is unlikely to be sufficient for many decades at least,” the company stated in its submission.

Instead, Rio Tinto wants the Australian government to focus its attention carbon sequestration, “the capture of carbon dioxide from fossil fuel use and its long term disposal in deep geological reservoirs” which it describes as “a promising prospect.”

One supporter for what is termed “geo-sequestration” is Robin Batterham, who has a foot in each of two camps. Batterham works two days a week as the Australian government's chief scientific adviser and three days a week as the chief technologist for Rio Tinto.

Robin Batterham (Photo courtesy Government of Queensland)

One was the launch of a government funded Rio Tinto foundation for research into a sustainable minerals industry, and the other was attendance at the Rio Tinto Australian Science Olympiads awards dinner. Brown argues that Batterham should resign from one of his two roles.

While public opinion surveys show strong support for the development of wind energy, the Australian government has opted to follow the U.S. government position of refusing to ratify the Kyoto Protocol that imposes binding limits on industrialized countries for the emission of six greenhouse gases responsible for climate warming.

Australia's binding target under the Kyoto Protocol would have been an increase in emissions of eight percent in the period 2008-2012. According to Environment Minister Kemp, the government is still taking this target seriously. "MRET is a key plank in achieving Australia’s 108 percent emissions target and in positioning Australia for a lower greenhouse signature," he said Friday.

But last week, Kemp confirmed that the government’s own specialist Greenhouse agency had been directed to abandon further research work on the international emissions trading scheme that is central to the implementtion of the Kyoto Protocol.

Fitzpatrick of Greenpeace Australia believes the recommendation of a low renewables target reflects the government’s determination to appease the fossil fuel lobby. “They are still not taking the wind industry seriously," she said. "What they should have done is adopted the 15 percent target so the industry can grow rapidly, reduce costs so they are cost-competitive with coal power and not need government support."

The Mandatory Renewable Energy Target Review Report is online at: http://www.mretreview.gov.au