It means that, while from one perspective the shift to clean energy is well under way, with about half the electricity in the main grid supplied by renewables, the next stage could be even more demanding. It\u2019s left some questioning whether the country can still reach the Albanese government\u2019s target of 82% renewable energy by 2030.<\/p>\n
Sign up for the Breaking News Australia email<\/a><\/p>\n The 82% figure wasn\u2019t meant to be a target \u2013 it started as a projection of what was possible before Labor was elected in 2022, but morphed into a national goal in the months afterwards. At the time wind, solar and hydro made up a third of the country\u2019s electricity.<\/p>\n Back then, the target was ambitious, but would have been achievable with sustained effort and investment, says Dr Dylan McConnell, an energy systems researcher at the University of New South Wales.<\/p>\n But four years out from 2030, the remaining gap looms large. An additional 8.5GW of wind and 9.5GW of solar needs to be planned and built, McConnell says, drawing on data from the Australian energy market operator. In capacity terms, that\u2019s adding more than the nation\u2019s entire existing wind power resources, but in the next three and a half years. That\u2019s over and above what the market operator already anticipates to come online.<\/p>\n \u201cIt\u2019s an extremely challenging task. The rate of renewable energy rollout that is now required to hit that target is unbelievable,\u201d McConnell says, and rapidly growing demand from datacentres is about to make things harder.<\/p>\n double quotation markWe\u2019re stuck in a vicious cycle where people are nervous that they\u2019re [not] going to let the coal closeTristan Edis, Green Energy Markets<\/p>\n Tristan Edis, the director of analysis and advisory at research and analytics firm Green Energy<\/a> Markets, says there\u2019s sufficient capacity in the pipeline \u2013 already approved under planning and environmental laws \u2013 to meet the government\u2019s 2030 target. But only about 12% of what is needed is currently under construction.<\/p>\n What that shows, he says, is environmental assessments aren\u2019t the key hold up. \u201cThat\u2019s not the predominant reason why so little is managing to get committed to construction,\u201d he says. \u201cThe choke point is that projects aren\u2019t able to find a customer that\u2019s prepared to sign on to a long-term power purchase agreement such that they can get the project financed.\u201d<\/p>\n Why? Edis says uncertainty about coal closure plays a big part. Two big generators \u2013 Yallourn, in Victoria\u2019s Latrobe Valley, and Eraring, in the Hunter Valley \u2013 are scheduled to close before 2030. But past experience<\/a> shows governments have a tendency to intervene to delay exit dates.<\/p>\n \u201cWe\u2019re stuck in a vicious cycle where people are nervous, or lacking sufficient confidence that they\u2019re going to let the coal close, so they don\u2019t invest in the new renewables to replace it,\u201d he says.<\/p>\n That\u2019s coupled with insufficient policy signals to drive the new investment.<\/p>\n The capacity investment scheme, the government\u2019s \u201ccornerstone policy\u201d<\/a> for new renewable energy has been slow to deliver.<\/p>\n Initially designed to support batteries and other firming, in 2023 and 2025 the scope and size of the scheme was expanded to include renewables alongside dispatchable capacity \u2013 totalling 40GW \u2013 about half the current capacity of the national electricity grid.<\/p>\n Eight tender rounds have supported 115 projects, including 25.5GW wind and solar. But the level of financial support provided by the government means that most projects also require a contract for their electricity, before they can start building.<\/p>\n Those power purchase agreements haven\u2019t been forthcoming at the rate needed to match the target, and only about 11% of the underwritten wind and solar farms have reached construction or operation, according to analysis<\/a> by Green Energy Markets and the Institute for Energy Economics and Financial Analysis.<\/p>\n Australian Energy Council\u2019s chief executive, Louisa Kinnear, says there\u2019s a need for \u201cdurable and stable policy settings\u201d including greater certainty about when coal will exit, and planning ahead for reliability and security.<\/p>\n \u201cYou end up in a sort of catch-22 where we know we need to stimulate investment in new generation so that coal can exit, but while coal remains in the system, prices are too low and not providing the right signal,\u201d she says.<\/p>\n
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