News Article
Australia Aims High For Clean Energy
Government plans to rival broadband investments
Australia's current policies to promote renewable energy will drive at least AUD 36bn of new investment from now to 2020, according to energy market research firm Bloomberg New Energy Finance. The clean energy expenditure will rival the AUD 35.9bn needed to build Australia's National Broadband Network, a project intended to extend fiber optic cable to 93 percent of the country's homes.
In the new Bloomberg New Energy Finance forecast, renewable energy investment will peak in 2017 with more than AUD 5bn to be spent on new large-scale wind and solar farms and smaller scale solar systems on commercial and residential rooftops. In all, nearly AUD 28bn will be deployed to utility-scale power generation projects to meet Australia's mandatory Large-scale Renewable Energy Target (LRET) and a further AUD 8bn will be invested by households and businesses for rooftop photovoltaics (PV).
The projections represent output from Bloomberg New Energy Finance's new financial model intended to forecast various scenarios under Australia's Large-scale Renewable Energy Target, and an analysis of the consumer economics of small-scale PV. The LRET model suggests that while investment in 2011 is expected to be subdued at AUD 3bn, it will jump to AUD 4bn in 2012 and stay above that level for most of the decade.
“In 2010 alone, over AUD 4bn was invested in renewable energy in Australia. That's nearly half of the amount the mining industry invested in equipment, plant and machinery over the same period,” said Seb Henbest, who heads Bloomberg New Energy Finance's Sydney-based research team. “We forecast that strong levels of investment will continue thanks to the national targets and the rapidly falling costs of clean energy. This means that by 2020, renewable energy in this country will be as big as the NBN.”
The LRET model forecasts that by 2020, Australia will be home to 11.9 gigawatts (GW) of wind energy, 4.3GW of large-scale PV and 1GW of thermal solar assuming the country meets its mandatory national targets. In addition, households and businesses will own 3.3GW of rooftop PV. As of the end of 2010, the country had 3.4GW of large-scale renewables (excluding large-hydro) and 499MW of small-scale PV, compared to a total capacity of 51GW, most of which is fossil fueled.
The pace of small-scale PV installations will be driven until 2014 by the current suite of subsidised tariffs and the federal government's Small-scale Renewable Energy Scheme (SRES). But by 2015 when these subsidies are phased out, the cost of PV will have dropped sufficiently to spur continued adoption by households, the analysis shows. Bloomberg New Energy Finance forecasts that in 2015 a 1.5 kilowatt system will cost AUD 4,500 in Australia, compared to around AUD 8,000 now.
The declining cost of solar energy will also drive investment in utility-scale PV and solar thermal projects. Bloomberg New Energy Finance's LRET model shows that by 2018, solar technologies will begin to gain market share from wind energy. The end result will mean approximately AUD 18bn is invested in wind power, AUD 16bn in both large- and small-scale PV and AUD 400m in solar thermal technologies.
