Enhar Pty. Ltd.

Suite G-03,
60 Leicester Street
Carlton VIC 3053
To
E!ert Panel "
#r $ic% &ar'urton () LV) *chair+,
$r ,rian -isher () PS#,
#s Shirley In.t Veld and
#r #att /e0a
$e!art0ent o1 the Pri0e #inister and Ca'inet
2ET2e3ie45!0c.6o3.au
$ate" 768058907:
RE: RET Review call for Submissions
To the E!ert Panel,
Enhar Pty Ltd is a consultin6 co0!any !ro3idin6 e!ertise in rene4a'le ener6y and ener6y
e11iciency to clients in (ustralia.
&e e0!loy (ustralian en6ineers and !ro3ide ser3ices to a 4ide ran6e o1 clients includin6
local 6o3ern0ent, state 6o3ern0ent, 0anu1acturin6 industry, 1ood industry, 4ater utilities,
uni3ersities and di3erse ran6e o1 s0all to 0ediu0 si;e 'usinesses in Victoria, <e4 South
&ales, =ueensland and &estern (ustralia. )ur 'usiness has steadily 6ro4n since its
ince!tion in 9006.
How has the RET influenced the development of the renewable energy industry?
The 2ene4a'le Ener6y Tar6et has under!inned 3irtually all o1 the results 4e ha3e 'een
a'le to achie3e 1or our clients and also assisted all o1 our !ro>ects 'oth directly and
indirectly. The incenti3es !ro3ided 'y LGCs and STCs, es!ecially since 900? 4hen a
'i!artisan increase o1 the Tar6et to 90@ 'y 9090 occured, ha3e ena'led the rene4a'le
ener6y 6eneration ca!acity in this country to 6ro4. The 2ET has ena'led 'usinesses to
6ro4 throu6hout (ustralia 1or the 0anu1acture, su!!ly, distri'ution, !ro>ect de3elo!0ent,
installation, 0aintenance and ad3isory sectors relatin6 to rene4a'le ener6y. It has also
'oosted e0!loy0ent in 6eneration and retail o1 ener6y and 0ar%etin6 o1 6reen !o4er.
Enhar has 'een acti3ely ser3icin6 clients in 0any o1 these sectors.
2ene4a'le Ener6y sources are an ecellent lon6 ter0 in3est0entA once u! 1ront ca!ital
costs ha3e 'een re!aid, the ;ero cost 1or 1uels such as 4ind and sun 0ean that 1or a
si6nicant !ortion o1 the !lant li1eti0e ener6y is deli3ered at a 3ery lo4 cost. Generation
sites 4ill 'e a'le to continue 1or decades at a lo4er cost each ti0e technolo6y is u!6aded
at the sa0e site. These are secure sources o1 ener6y B there is a'solute certainty that the
ener6y su!!ly 4ill continue inde1initely 4ithout e3er de!letin6 4hich cannot 'e said 1or any
1ossil 1uel or e3en nuclear.
The only 0a>or chan6e 4hich needs to 'e 0ade to the 2ET is to si6ni1icantly etend it, 1or
ea0!le"
30@-:0@ 'y 9030
:0@-50@ 'y 90:0
50@-700@ 'y 9050
These 4e consider are achie3a'le and 4orth4hile tar6ets 1or the country and settin6 an
etended tar6et 1or 9030 should 'e the 1irst !riority.
444.enhar.co0.au
(,< 3?7:?9:?370
Enhar Pty Ltd 2ET 2e3ie4 Su'0ission #ay 907: - 444.enhar.co0.au
Enhar is a 0e0'er o1 the Clean Ener6y Council *CEC+ and 4e ur6e this !anel to !lace
si6ni1icant 4ei6ht on the su'0ision 1ro0 the CEC 4ho re!resent our 6ro4in6 industry.
Should the LRET abolished, reduced or increased? f retained, what level should it
be?
The discussion in your !a!er re6ardin6 4hether the 2ET should 'e %e!t at 90@, reduced,
or scra!!ed 4e consider to 'e the 4ron6 de'ate" the de'ate should 'e ho4 0uch shall it
'e etended and ho4 Cuic%ly should the etention 'e reached.
Dnder a 30@ 'y 9030 tar6et, 1or ea0!le, i1 the currently le6islated :7,000 G&h is
achie3ed and this eceeds 90@ o1 de0and in 9090, this 4ould 'e a success1ul outco0e, as
additional 3alua'le !ro6ress to4ards the 9030 tar6et 4ould 'e already 0ade.
!osts and "enefits of the RET
The a!!roach o1 your re3ie4 a!!ears to 'e that no 'ene1it is 4orth any de6ree o1
Ea3oida'leE short ter0 ener6y cost. This a!!roach i6nores the 0assi3e 0ediu0 to lon6
ter0 'ene1its o1 rene4a'le ener6y, includin6 car'on a'ate0ent. In 1act, the lo4 cost o1 the
2ET is a'solutely 4orth4hile.
(tte0!tin6 to 0ar6inally lo4er ener6y costs in the 3ery short ter0 *current election cycle+
is the 4ron6 a!!roach. Lon6 ter0, sustaina'le lo4 car'on ener6y 4hich hel!s a3ert
cli0ate chan6e and creates >o's in (ustralia are 4orth4hile 6oals and this !anel ou6ht to
reco6nise this.
( re3ie4 o1 the 2ET is not reCuired so soon since the last statutory re3ie4 co0!leted in
9073, and !ushin6 the current re3ie4 throu6h 'e1ore the net statutory re3ie4 scheduled
this year a!!ears to 'e an atte0!t to su'3ert the 2ET. &e ho!e that this !anel 4ill heed
the 3ie4s o1 this industry 'e1ore 0a%in6 any reco00endations.
Fistorically, the !riority o1 !ro3idin6 !o4er to the 4hole country dro3e 0assi3e !u'lic
e!enditure in !o4er stations and net4or% in1rasturcture.
In the contet o1 the current ris%s to our econo0y and en3iron0ent !osed 'y 0an-0ade
cli0ate chan6e, the i0!ortance o1 decar'onisin6 our ener6y 6eneration is no4 eCually hi6h
and ur6ent as the ori6inal !u'lic !riorities o1 ener6y su!!ly e3er 4ere. The CSI2) as 4ell
as the IPCC ha3e !u'lished the e3idence that cli0ate chan6e is 'ein6 caused 'y hu0an
e0issions and CSI2) has also !u'lished e3idence o1 the current ad3erse i0!acts and the
1uture 4orstenin6 i0!acts on (ustraia o1 hu0an induced cli0ate chan6e. $oin6 a 1air
share in the 6lo'al e11ort to a3ert cli0ate chan6e is the only res!onsi'le course o1 action
1or (ustralia, (ustralians understand this e3en i1 the current 6o3ern0ent does not.
The stationary ener6y sector is a 0a>or e0itter in (ustralia. (s noted in your o4n !a!er,
(ustraliaEs annual 6reenouse 6as e0issions are 99.5 #t C)9e lo4er as a result o1 the 2ET.
&ithout the 2ET (ustralia 4ould not ha3e 0et its e0ission reduction tar6et under Gyoto.
7
To 0eet is 1urther e0ission reduction co00it0ents o1 5-90@ reduction, increased
rene4a'le ener6y, alon6 4ith ener6y e11iciency, are essential and the 2ET is essential.
There1ore to tal% a'out short ter0 cost sa3in6 'y reducin6 the 2ene4a'le Ener6y Tar6et is
1ailin6 to reco6nise the real res!onsi'ilities o1 6o3ern0ent 4hich are to secure a sa1e and
!ros!erous 1uture, includin6 a sa1e cli0ate.
In the 1il0 EThe TitanicE, a1ter the ice'er6 has struc% and li1e>ac%ets are 'ein6 handed out,
a 1irst class !assen6er tells their 0aid to !ut the %ette on in her ca'in so they can ha3e a
nice cu! o1 tea 4hen Eall this 1uss is o3erE. <ot 'elie3in6 that the incident could 'e as
serious as li1e>ac%ets 4ould i0!ly, denial o1 the ris% o1 the situation too% hold. &hen hours
7 SG# The ,ene1its o1 the 2ene4a'le Ener6y Tar6et to (ustralia.s Ener6y #ar%et and Econo0y,
9079. htt!"88444.cleanener6ycouncil.or6.au8
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Enhar Pty Ltd 2ET 2e3ie4 Su'0ission #ay 907: - 444.enhar.co0.au
later the shi! san% into 1ree;in6 seas 4ithout enou6h li1e'oats, the story ended tra6ically
and the !assen6erEs denial turned out to 'e 1olly.
Sa3in6 a 1e4 dollars 'y re0o3in6 the car'on ta, re!ealin6 the clean ener6y le6islation
and tin%erin6 4ith the 2ET is analo6ous to tryin6 to 0a%e a cu! o1 tea on a sin%in6 Titanic.
There is no !oint en>oyin6 a sli6hly chea!er 1e4 years 4hen the hu6e costs o1 a 0a>or
cli0ate disaster are a!!roachin6 and 4ill cause the nation to su11er 0any 0ore years o1 1ar
hi6her costs.
(ustralia is one o1 the countries 0ost 3ulnera'le to cli0ate chan6e, accordin6 to the Stern
re!ort and others, due to the i0!ortance o1 its a6ricultural sector and the !ro0inence o1
its coast. Considerin6 that (ustralia has 0ore at sta%e than 0ost other countries, action on
0ini0isin6 cli0ate chan6e should 'e an on6oin6 !riority. Policies such as the 2ET 4hich
deli3er ecellent car'on a'ate0ent should 'e 0aintained and stren6thened.
( 3ia'le cli0ate sa1ety !lan should 'e de3elo!ed, not a short ter0 !enny-sa3in6 eercise
4hich 0a%es us 0ore e!osed to a 0uch 4orse lon6 ter0 outco0e.
&e ur6e the Panel to consider the car'on a'ate0ent cli0ate 'ene1its o1 the 2ET, as 4ell as
the scienti1ic certainty o1 cli0ate chan6e, in your deli'erations.
)ther countries are ta%in6 a 0ore res!onsi'le a!!roach to cli0ate and ener6y. -ar 1ro0
reducin6 rene4a'le ener6y tar6ets, other countries are etendin6 the0.
#obs and the RET
In ter0 o1 e0!loy0ent, the 2ET since 9007 has contri'uted to e0!loy0ent in the
rene4a'le ener6y industry o1 a!!roi0ately 9:,000 at the end o1 9079, 0uch o1 4hich is
in rural or re6ional (ustralia.
9
2ecently !u'lished state0ents 1ro0 the CEC !ro3ide hi6hly rele3ant state0ents a'out >o's
and costs in relation to the 2ET"
Leaving the policy alone would create approximately 18,400 jobs by the end of
the decade, additional investment of 1! billion in large"scale renewable energy
and lower power bills over the medium term#
$ousehold power prices will actually be lower by the end of the decade with the
%enewable &nergy 'arget in place, as it will offset the rising cost of using gas to
produce electricity# 'he research by %()* +onsulting found that household energy
prices would be !0 per year lower by ,0,0 with the %&' in place - a combined
saving of approximately !00 million#.
/
#ost o1 these >o's and the 'illions o1 dollars in in3est0ent that 6o 4ith the0 ha3e 'een
1ocused on rural and re6ional areas.
The S2ES is currently res!onsi'le 1or at least 79,000 >o's around (ustralia, 0ainly in solar
PV. There ha3e 'een 0ore than 9 0illion s0all-scale installations under the S2ES. The
S2ES should re0ain and not 'e reco0'ined 4ith the L2ET.
(round 5,000 -TE >o's 4ould 'e lost i1 the S2ES 4ere scra!!ed.
( ca!!in6 o1 STC Cuantities in !lace o1 unca!!ed STCs 4ould in our 3ie4 0a%e sense and
'e consistent 4ith achie3in6 a :7,000 G&h tar6et.
9 Source" Clean Ener6y Council 4e'site
3 Clean Ener6y Council 0edia release H
th
#ay 907:, Cuotin6 Gane Thornton, $e!uty Chie1
Eecuti3e o1 CEC.
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Enhar Pty Ltd 2ET 2e3ie4 Su'0ission #ay 907: - 444.enhar.co0.au
$uestion from %anel Enhar Response
Fo4 has the 2ET !er1or0ed a6ainst the
o'>ecti3es in the 2ene4a'le Ener6y *Electricity+
(ct 9000I
The 2ET has !er1or0ed ecellently and the
industry has 0et its tar6ets.
(re there 0ore e11icient and e11ecti3e
a!!roaches to achie3in6 these o'>ecti3esI
<o, the 2ET is a !ro3en, e11icient 0ar%et
0echanis0.
$o the o'>ecti3es o1 the (ct re0ain a!!ro!riate,
in li6ht o1 1allin6 electricity de0and and the
Go3ern0ent.s tar6et and !olicies 1or reducin6
6reenhouse 6as e0issionsI
Jes, the o'>ecti3es are still a!!ro!riate.
Energy %rices and the RET
Jour call 1or su'0issions !a!er 0a%es re1erence to causes o1 ener6y !rice increases"
KElectricity !rices ha3e increased 'y 5H !er cent o3er the !ast 1our years due to increases
in net4or% costs *the !oles and 4ires+ and the i0!act o1 en3iron0ental sche0es such as
the car'on ta, state and territory 1eed-in-tari11s and the 2ET.L
( !a!er 'y the Clean Ener6y Council discusses chan6e in the annual electricity 'ill o1 a
ty!ical residential custo0er in <S& on re6ulated retail !rices, 900M80H to 907387:.
This in1or0ation, de3elo!ed 'y IP(2T, !uts the i0!act o1 the 2ET into !ers!ecti3e, 1or
ea0!le illustratin6 the 6reater increases in the cost o1 retail, 0ore than t4ice the cost o1
the 2ET. The cost o1 the 2ET is d4ar1ed 'y the cost o1 net4or% u!6rades.
$uestion from %anel Enhar Response
Should the L2ET and S2ES sche0es 'e
reco0'inedI
<o, the se!aration o1 the t4o sche0es is still
reCuired.
Should any other ener6y sources 'e
included in the L2ETI Should any
non-rene4a'le *'ut lo4 e0issions+
ener6y sources 'e includedI
EnharEs 3ie4 is that the current eli6i'le ener6y
sources are a!!ro!riate and non-rene4a'le sources
should de1initely not 'e included. Gas or any other
1ossil 1uel should continue to 'e ecluded as they are
non-rene4a'le i.e. 4ill run out and !roduce
e0issions.
$o s0all-scale rene4a'le ener6y
syste0s still reCuire su!!ort throu6h
the S2ESI I1 so, 1or 4hat !eriod 4ill
su!!ort 'e reCuired 1orI
Jes the current settin6s in the S2ES are a!!ro!riate
and should re0ain.
Should any ne4 s0all-scale 6eneration
technolo6ies 'e eli6i'le under the
S2ESI
(s noted 'y the Clean Ener6y Council, the 2ene4a'le
Ener6y Su' Grou! *2ESG+ o1 C)(G considered this
issue in detail and 1oundA K2ESG.s reco00endation is
to not etend eli6i'ility under the 2ET to any ne4
s0all- scale technolo6iesL 6oin6 on to say that to do
so 4ould K0ean an unacce!ta'le le3el o1 uncertainty
re6ardin6 the !otential i0!acts... !articularly on
electricity !ricesL
Pa6e :
Enhar Pty Ltd 2ET 2e3ie4 Su'0ission #ay 907: - 444.enhar.co0.au
$uestion from %anel Enhar Response
I1 'rand ne4 s0all scale technolo6ies e0er6e and
'eco0e co00ercially !ro3en these could 'e included
in due course, ho4e3er there are no such candidates
at !resent.
Should any ne4 dis!lace0ent
technolo6ies 'e eli6i'le under the
S2ESI
)nly technolo6ies 4hich !roduce ener6y should 'e
eli6i'le. Technolo6ies 4hich dis!lace or sa3e ener6y
should 'e su!!orted throu6h other 0echanis0s.
&hat should 'e the 1reCuency o1
statutory re3ie4s o1 the 2ETI
The current re3ie4 is in addition to a staturory re3ie4
already scheduled this year, and is itsel1 an ea0!le
o1 ecessi3e re3ie4s o1 the 2ET.
Enhar 'elie3es the 1reCuency o1 the re3ie4s should
'e reduced to once e3ery 1our years.
&e a6ree 4ith the Clean Ener6y Council res!onse
that the sco!e o1 any 1uture re3ie4 should also 'e
reduced such that those as!ects o1 the sche0e that
are 4ell esta'lished and ha3e 'een re3ie4ed
re!eatedly o3er the !ast decade, should 'e re0o3ed
1ro0 the sco!e o1 re3ie4s. -uture re3ie4s should
only consider increasin6 the tar6et *rather than any
reduction+. These chan6es 4ould 6reatly incease
in3estor certainty.
Can the ad0inistrati3e arran6e0ents
o1 the 2ET 'e si0!li1iedI I1 so, ho4
can they 'e si0!li1ied and 4hat 4ould
'e the ris%s o1 doin6 soI
Jes, the 1reCuency o1 re3ie4s should 'e reduced to
once e3ery 1our years. This 4ould reduce in3estor
uncertainty. The on6oin6 ad0inistration o1 the day to
day 1unctionin6 o1 te 2ET is e11icient.
&ative 'orest (aste
This to!ic has 'een dealt 4ith at len6th in !re3ious re3ie4s and the current restrictions on
use o1 4ood 4astes in the 2ET are a!!roriate and consistent 4ith the !re3ious consultation
res!onses. Enhar does not see any 0erit in the reintroduction o1 4ood 4aste deri3ed 1ro0
nati3e 1orest as an eli6i'le rene4a'le ener6y source under the L2ET. The a'undance o1
other rene4a'les includin6 4ind, solar, hydro, 0arine, 'io6as and sustaina'le !lantation
'io0ass is su11icient 4ithout reCuirin6 en3iron0entally contro3ertial nati3e ti0'er sources
to 'e included.
$uestion from %anel Enhar Response
&hat ad0inistrati3e and re6ulatory
arran6e0ents should 'e !ut in !lace to ensure
that the reinstate0ent o1 nati3e 1orest 4ood
4aste is consistent 4ith the sustaina'le
0ana6e0ent o1 nati3e 1orestsI
<ati3e 1orest 4ood 4aste should re0ain ineli6i'le 1or
LGCs. Se!arate incenti3es 1or use o1 rene4a'le 4ood
4astes could 'e esta'lished, outside o1 the 2ET.
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Enhar Pty Ltd 2ET 2e3ie4 Su'0ission #ay 907: - 444.enhar.co0.au
!onclusion
The 2ET is a succes1ul and essential !olicy 1or the ener6y sector in (ustralia. #aintainin6
and stren6thenin6 the 2ET is a 3ital role 1or 6o3ern0ent in order to !rese3e the 0any
'ene1its o1 the 2ET. The 9090 tar6et should 'e %e!t at :7,000 G&h and additional tar6ets
1or 9030 and 'eyond should 'e set, 1or ea0!le 30@ or 0ore 'y 9030. The hori;on 1or the
LGC 0ar%et should 'e etended 4ell 'eyond 9030.
The re3ie4 has 'een an o!!ortunity to e0!hasise the achie3e0ents o1 the 2ET and the
i0!ortance o1 0aintainin6 and enhancin6 the 2ET, ho4e3er the 1reCuency o1 re3ie4s
should 'e reduced to once e3ery 1our years or less to a3oid in3est0ent standstills.
Jours sincerely,
$e0ian <ata%han
$irector
Enhar Pty Ltd
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