Push for low-carbon targets on power firms: Finkel review

THE electricity industry will have to meet new low-emissions targets, under recommendations to be put to the Turnbull government next week.

A push for low-carbon targets on power firms will be among the recommendations put to the Turnbull government next week. Picture: AFP/Roslan Rahman

THE electricity industry would have to meet a new low-emissions target that favoured only clean coal-fired power sourced through carbon capture and storage (CCS) and delivered greater subsidies for gas and renewables, under recommendations to be put to the Turnbull government next week.

New rule changes to the National Electricity Market will suggest the requirement that all new large-scale renewable projects have storage capacity such as batteries to address ongoing reliability issues, reports The Australian.

Australia’s Chief Scientist, Dr Alan Finkel. The Finkel review of the National Electricity Market will set a new carbon emissions target Picture: Renee Nowytarger/The Australian

According to The Weekend Australian, the Finkel review of the National Electricity Market will set a new carbon emissions target for the industry expected to be about 0.7 tonnes of CO2 a megawatt hour.

It will also place stricter-reliability rules on new large-scale renewable projects.

The final report to be delivered to the Council of Australian Governments next Friday has discarded the preferred energy intensity scheme in favour of a low-emissions target (LET) that would be “energy-neutral” but indirectly penalise coal without CCS.

The new target would be separate from the Renewable Energy Target.

The report will lend qualified support to the government’s pursuit of new clean coal energy sources to solve Australia’s looming energy supply crisis, but place a significantly higher bar on the sector by putting benchmarks out of reach for coal without CCS.

The new target would be separate from the Renewable Energy Target.

President Donald Trump announcing that the US will withdraw from the Paris Climate Agreement. Picture: AP/Andrew Harnik

Industry groups, briefed on the report, have been told it would provide tradeable clean-energy certificates for low-emissions generation, such as wind, solar and gas, and coal-fired power with CCS. Energy retailers and large industrial users would then be ­required to source a mandated amount of certified clean power.

Some industry sources said it would put coal at a distinct dis­advantage while providing even greater subsidies for renewables.

The report will argue that the LET will contribute to greater ­stability by creating certainty for investment. The report will further say the LET will be needed for Australia to meet its Paris climate change agreement, to which Malcolm Turnbull said he was committed to, ­despite US President Donald Trump’s decision to pull the US out of the agreement.

Protesters hold up signs during a demonstration in front of the White Houseafter Donald Trump withdrew the US from the Paris Climate Agreement. Picture: AFP/Paul J Richards

It is expected that the LET would be applied to new energy investment, with the RET subsidies grandfathered to existing investments in renewables.

The purpose would be to provide greater incentives for gas and renewable-energy generation.

This article was originally published in The Australian and is reprinted with permission