This quick guide provides a brief background to the Commonwealth’s Renewable Energy Target – what it is, what it costs, how it operates, and whether it is achieving its aims.
What is the Renewable Energy Target?
The Renewable Energy Target is a Commonwealth Government scheme to increase the proportion of electricity generated in Australia from renewable sources, to reduce the emissions of greenhouse gases from electricity generation and to promote the development of a renewable energy industry in Australia. The ‘target’ of the scheme is to generate an additional 20 per cent of electricity from renewable sources by 2020, compared with 1997 levels. (Originally, the target was an additional two per cent by 2010.) The ‘Renewable Energy Target’ also refers to the legislated scheme that provides the mechanism for achieving the target through the creation and trading of renewable energy certificates. This certificate-trading scheme allows generators of renewable energy to earn additional income for the electricity that they generate, above the market price.