Renewable energy commitments hit 6-year high in boost to 2030 target hopes

More than $9bn worth of renewable energy projects secured ­financial commitments in 2024, buoying hopes that Australia could yet reach its 2030 emissions targets.

More than $9bn worth of renewable energy projects secured ­financial commitments in 2024 – the highest in six years – new data from the Clean Energy Council has shown, buoying hopes that Australia could see a much-anticipated rapid increase in zero emission capacity.

The figures revive some hope over the prospect of Labor meeting its target of having renewable energy generate 82 per cent of the nation’s power by 2030 – a plan that most believed would not be met.

The CEC said its data showed the pace of new renewable energy projects materially increased during the last three months of 2024 – with seven new large-scale renewable energy projects, representing 1598MW of new generation capacity, and $2.4bn of capital investment securing financial commitment.

CEC chief executive Kane Thornton said the strong quarterly result was in line with the pace required for Australia to hit its target of 82 per cent renewables by 2030.

“Clean energy already powers around half of our national energy needs,” Mr Thornton said. “We have now seen two consecutive quarters of very healthy investment activity in 2024, which is the best we’ve seen since the investment highs of 2018, when our sector was ­delivering on the bipartisan Renewable Energy Target.

“These strong results show that the clear policy signals and support from the federal and state governments and agencies to lower the barriers to investment is paying off.”

While the figures will be cheered, much of the substantial progress continues to be made in storage – predominantly batteries, which are profitable amid wild daily swings in wholesale electricity prices.

Longer storage projects, which can support the grid during periods beyond four hours, continue to lag and generation assets such as large-scale wind and solar projects are also struggling to overcome a plethora of issues.

But the CEC data indicates some progress as the federal Labor government’s centrepiece strategy, the capacity investment scheme, begins to accelerate work.

Labor in 2023 said taxpayers would underwrite 32GW of capacity. The Australian Energy Market Operator estimates the nation needs 57GW of grid-scale solar and wind generation capacity to be installed by 2030 – a rise from the current capacity of 19GW.

The so-called capacity investment scheme government scheme sees developers guaranteed a minimum return on new solar and wind projects. Under the scheme, should the wholesale electricity price fall below an agreed threshold, taxpayers will compensate the renewable energy project. Should the wholesale electricity price exceed a metric, developers pay the government – a design that removes revenue risk from developers and accelerates much-needed investment.

The CEC said there were currently 88 renewable electricity generation projects that have ­either reached financial commitment or were under construction, representing 13.2GW of capacity in the pipeline. There were also 52 committed storage projects in development, equivalent to 10.5GW / 26.3 GWh in capacity / energy output. These pipeline projects represent at least $36.5bn worth of capital investment.

Originally published as Renewable energy commitments hit 6-year high in boost to 2030 target hopes