Zen Energy CEO Anthony Garnaut has joined a chorus of industry voices calling on the Albanese government to deliver a policy shot-in-the-arm to Australia’s renewable energy market, including through an extension of the RET and mandatory climate reporting.
Garnaut – whose renewables gentailing company counts his father, climate and energy guru Ross Garnaut, on its board – says that despite a flurry of policy activity late last year and early in 2023, there is currently a hiatus in federal government messaging on renewables.
This is problem, Garnaut says, considering Australia needs to lift its renewables run-rate fourfold – to around 1.5TWh of new generation every month for the next 60 months – to have any hope of reaching the national 82 per cent renewable energy target by 2030.
“How do you translate 82% renewables or being Paris aligned into a price for electricity or environmental certificates, or a combination of them, such that we can underwrite new generation at speed?
“We’re not there now. And I think what’s happening is the government is hoping that voluntary demand will carry the day.”
Garnaut says the “simple proof” that this strategy is not working is that we haven’t seen uplift in investment in in renewable energy in Australia since the Albanese government has come into power.
“They got excited in the last quarter of 2022 when there was seen to be an uptick in renewable investment… but then we discovered that a lot of that was down to a single project called Golden Plains,” he said ahead of the Australian Clean Energy Summit in Sydney this week.
“It’s a really important contrast that the energy transition isn’t this disorderly everywhere,” he adds. “It’s not disorderly in Europe. … Most of the European electricity companies signed up to the Paris Agreement, and they had a rapid transition away from fossil fuels.”
Garnuat says one of the main missing ingredients in Australian renewables right now is “bankable PPAs,” power purchase agreements to underpin new solar and wind energy generation development.
“And it comes down to, then, the question of why is that? And the first reason is because the people who write PPAs don’t see the investment case.
“As far as I’m aware, none of the major private retailers have written the wind or solar PPA for five years. …That’s five years in which Zen has written 26,” he says.
“I’m happy to acknowledge that carbon pricing isn’t something that this government is inclined to do in the short term. So what can be done?”
Zen Energy seeks to answer this question in an in-depth discussion paper Garnaut will present at ACES on Tuesday afternoon, called Resolving Complexity: Points of focus to get to 82 percent renewable and beyond.
The paper makes three key recommendations: Introduce measures to firm up supply chains, including getting more EPC contractors into the market; extend the Renewable Energy Target to 2040, and; make climate disclosure mandatory for all large organisations in the next 12 months.
A push to extend the RET was also made on Tuesday by the CEO of the Clean Energy Council, Kane Thornton, who told ACES the renewable energy target – which was met in 2020 – should be extended to 2030 to support development needed to meet the 82% target.
But Garnaut, who argues for the RET to be extended for a further decade, out to 2040, is also passionate about the need for clear, transparent and externally auditable mandatory climate disclosure reporting.
“There’s a bunch of elements there that are pretty obvious, once you think about it,” he tells RenewEconomy.
“If every industry has its industry trajectory, and we’re all measured against that – and companies have to set a strategy that’s Paris aligned, then they have a certain period to demonstrate that they’re executing in line with that strategy.
“Then then there’s no wriggle room,” Garnaut says. “If you have a strategy that’s not aligned with the Paris Agreement, you’re anti-humanity. You’re anti-grandchildren. And no company wants to be that.”
