State-based renewable energy targets and cheaper technologies are driving investment in the sector despite a lack of policy certainty from the federal government, a key agency says.
The Clean Energy Finance Corporation invested a record $2.3 billion towards projects during the past financial year, with business “getting on with it” as wind and solar become more affordable.
For every dollar the CEFC invests, the private sector provides $1.80.
“Even though the federal government has been moving around in the last couple of years in terms of their regulatory environment, we’re seeing a whole raft of investment still just happening in any case,” chief executive Ian Learmonth told ABC Radio on Thursday.
The right balance needs to be found for renewable energy supply and demand, with the 1.8 million Australian homes currently with solar expected to increase.
“It’s a direction that’s going to continue unabated so I think we have to prepare ourselves for it,” he said.
“Pumped storage and battery storage are two very big trends.”
Another key factor in driving investment has also been the Renewable Energy Target, which the federal government will not renew or replace when it expires in 2030.
Mr Learmonth does not expect the recent decision to create an investment cliff.
“Whether it’s quite as strong as we’ve seen before is the question but the reduced cost in technology is certainly driving a lot of new investment,” he said.
Energy Minister Angus Taylor says the government plans to introduce legislation later this year to give it the “big sticks” needed to ensure energy giants take pressure off prices.
The government will “get out of their way” when customers have a fair deal, Mr Taylor told Sky News on Thursday.
Mr Taylor will seek to scrap loyalty taxes, where customers pay a higher rate for electricity after the cheaper prices they are lured to sign up with expire.
The federal government plans to publish a short list of new energy supply projects early next year, which the energy minister says will provide reliable, affordable power into the electricity market.