With the Clean Energy Finance Corporation confirming $1.9 billion in renewable generation, transmission and storage investment over 2022-23 there are positive signals to the market that Australia can grow its economy on the back of renewables.
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Strong private sector investment has been stimulated by co-investment from federal and state governments. But much more needs to be done, and governments have more work to do to get the settings right.
The UN's Conference of Parties or COP28 sent a strong signal to the worlds' markets that fossil fuels are on the way out. We have a choice as a nation to stick our heads in the sand and pretend our economy isn't fundamentally shifting - and in our favour, by the way, as we're rich in renewables and the resources required to build them - or we can embrace the change and reap the economic and environmental benefits.
As a mature nation and economy, Australia is well past debating the fact that we need to act on climate and ramp up investment in renewables, to deliver not only environmental benefits but, critically, the economic dividends needed for sustainable new growth as emissions-intensive sectors contract.
Old coal is shutting down and this journey should not be prolonged as a result of insufficient investment in renewables. The NSW government's decision to invest in extra battery capability so that Eraring does not have to stay open beyond its official closure date is smart economics - we know that renewables are the cheapest option for new energy requirements - as well as being positive for the environment.
The Australian Energy Market Operator has just released its draft plan for the next 20 years for the grid that covers most of the eastern states, noting that the build out of transmission infrastructure will deliver an estimated $17 billion in benefits to energy consumers.
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This latest plan shows that the energy shift to clean power is not only achievable, but will also create tens of thousands of jobs, make our electricity grid more stable, and less hooked on the rollercoaster of international coal, oil and gas prices.
And there is no shortage of green capital waiting to invest. But if approvals for renewable projects take too long, they will find other places to put their money. A recent report by the Clean Energy Investor Group showed that it took almost 10 years for the single wind farm approved in NSW in the past five years to get the go ahead.
On the other hand, it took, on average nearly two years for solar and just over a year for batteries to be approved, which is both a realistic timeframe for a major development and more acceptable to meet our transition needs while reducing the prospect of system reliability.
It was encouraging to see at COP28 the Australian government sign up to the pledge to triple renewable capacity by 2030, and the recently boosted Capacity Investment Scheme announced by Climate Change Chris Bowen provides huge incentives for - now we need state and territory governments to overhaul their planning processes so we can deliver on that commitment.
We hear over and over that Australia has the potential to become a renewable energy superpower. Australia can absolutely meet all our renewable energy targets and indeed we must if we are to play our role in limiting global warming to 1.5 degrees.
Of course, this transition needs to be done with thorough and considered consultation with affected communities. Consultation on new renewable projects need to include representatives of conservation and biodiversity experts and this should include marine experts for offshore transmission developments.
We have the opportunity now to make up for a lost decade of inaction on climate change, and even to make hay while the sun shines.
- Nicki Hutley is an economist and a Climate Councillor.
