Investment in renewables in Australia has declined by 88% due to uncertainty about the future of the sector, and it has actually fallen behind similar economies, according to a report. One reason is directly related to government policy contrary to it. Instability, uncertainty and changes in policies have had a negative impact.
The new report by the Climate Council, The global renewable energy boom: How Australia is missing out, says that despite having sufficient renewable energy resources to feed the country 500 times, employment and investment in the sector of renewable energies have fallen sharply since the government of the Coalition came to power.
Worldwide boom of renewables
Worldwide, investment and employment in renewable energies are booming. Investment in clean energy sources in China grew by 32%; 8% in the US; 12% in Japan and in Germany and Britain only 3% last year.
But in Australia in the same period, investment fell 35%. Investment in renewable energy on a large scale was reduced by 88% due to uncertainty about the future of Renewable Energy Targets (RET). In fact, industry representatives say the country’s clean energy investment has virtually ceased.
Worldwide more than 800,000 jobs were created in renewable energy in 2014. Solar industry in the US only added more than 31,000 new jobs, an increase of 21.8% over the previous year.
But in Australia, figures from the Australian Bureau of Statistics (ABS) show that the renewable energy sector has lost nearly 2,500 jobs since the election of the new Australian government. The number of jobs in the sector peaked in 2012 to 14,890, but fell by 15% to 12,590 last year.
Clearly, the global boom in renewables is a change that seems to be there to last over time, quite unlike other sources of energy such as coal, pressured by the threat of life survival if we continue to burn fossil fuels to generate electricity.
This boom has also led to the sharp drop in the costs of wind and solar energy. In the past five years, global wind costs fell 14% and the prices of photovoltaic solar energy fell 75%.
But also, the PV costs are expected to fall another 45% over the next five years, which will make this energy the cheapest form of electricity generation in many parts of the world. Globally, renewable energy is now as cheap as electricity generated by fossil fuels or even cheaper.
Instability and insecurity
The countries experiencing the greatest growth in renewable energy are those with a long-term consistent energy strategy and specific policies related to that strategy.
However, instability, uncertainty and policy changes may adversely affect risk perception of investors, resulting in low levels of investment. This is what has happened in Australia under the current government.
The government is locked in a dead- end thinking about how to trim the objectives to be achieved. The current target is 41,000 gigawatt hours, which is likely to represent over 20% of the energy needs of Australia in 2020. Both government and opposition believe that this amount is too high, and therefore, last May 8 it was agreed to be cut to 33,000 GWh.
Negative impact of the policy
Business associations, including the Business Council of Australia, the Council of Renewable Energy and Energy Users Association warned that “the uncertainty of these revisions cause a negative impact on the renewable energy sector, but also among consumers, the traditional energy sector and the business community in general. “
Australia is one of the sunniest and windiest countries in the world. It has sufficient renewable energy resources to easily meet their energy needs, but they are missing the train of progress in this area because of a bipartisan political union that only sees future for coal mining.