Australia: The Albanese government will extend the “Investment Scheme”, to boost the new clean power generation and storage capacity. The Australian Minister for Climate Change and Energy, Mr. Chris Bowen, has announced it at the Energy and Climate Change Ministerial Council meeting in Perth.
The federal government acknowledged that it is needed to meet its objective of Australia running on 82 percent renewable energy by 2030. The scheme involves the government underwriting new investments in renewable generation and storage through “contract for differences” that shares the risks between investors and taxpayers.
The government will underwrite 32 gigawatts of new electricity, consisting of 9GW of storage and 23GW of variable renewable generation, as per the statement. Fossil fuels, including gas-fired power, will not be eligible.
It comes after a significant drop in investment in large solar and wind farms this year. The Clean Energy Council warned that the first half of 2023 marked the slowest start in terms of financial commitments for significant clean energy projects since 2017.
Within the scheme, the contracts are won by competitive bidding. The federal government will negotiate agreements with the states and territories to support what it hopes will be a smooth transition to net zero emissions by 2050, in addition to providing its share of the underwriting.
The extension of the underwriting program occurs ahead of Australia’s participation at this month’s UN climate talks in the United Arab Emirates. A global assessment of the state of efforts to reduce emissions will be included in Cop28. The UN has warned the public that the world is headed for a “hellish” 3C° global warming as nations get ready to gather.
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