New investments in solar and windfarms and batteries declined further in the September quarter, falling below one-tenth of the pace required for Australia to meet its decarbonisation targets for the electricity sector, the Clean Energy Council said.
As delegates gather in the United Arab Emirates for a global climate conference, Cop28, the latest data shows the capacity of new projects reaching final investment signoff in Australia was near its lowest level since the survey began in 2018.
During the quarter, just two new generation plants with 161MW of capacity secured investment commitment – the 120MW Munna Creek solar farm in Queensland, and a hybrid wind, solar and storage project at the Jundee Mine in Western Australia.
For the year to date, new projects have a total generation capacity of 509MW.
Council chief executive, Kane Thornton, said the results were “a clarion call for strong and decisive action” given the scale of investment needed to replace ageing coal-fired power stations.
“Between now and 2030, Australia needs a substantial increase in financial commitments for large-scale renewable projects, in the order of 6.9GW a year to achieve the federal government’s target of 82% [share of the electricity market] by 2030,” Thornton said.
“The rate of investment slowed more dramatically over the past year as a result of higher project costs, complex permitting processes, a congested grid and intensifying global competition in the race to net zero,” he said.
Another poor quarter for renewable generation investment comes days after energy minister Chris Bowen unveiled a fivefold increase in the government’s capacity investment scheme.
Industry welcomed the expanded plan – which would set price floors and ceilings to give investors more certainty. Still, planning and other obstacles remain to unlock the large pipeline of potential projects.
According to the council, there are 108 generation and storage projects which have either reached financial commitment or are under construction. That tally equates to 12.6GW generation project capacity, as well as 5.8GW/ 13.5GW-hours of energy projects.
Storage projects, which had been a relatively bright part of the industry, also fared poorly in the September quarter.
Only 12MW, or 13MWh, of large-scale batteries gained final investment decision in the September quarter, as part of the off-grid Jundee Mine project.
On a 12-month rolling average, investments in new generation capacity slumped 13% from the June quarter to 608MW. For storage, the 12-month average fell 5.1% to 1.254MWh, the council said.