Prime Minister Tony Abbott’s government will negotiate with the opposition to cut Australia’s renewable energy target and exempt industries such as aluminum and copper smelting.
Industry Minister Ian Macfarlane said he was “reasonably confident” the target would be reduced from the current 41,000 gigawatt hours of electricity from renewable projects to between 26,000 and 28,000. While negotiations with Labor will start today, legislation is unlikely to be passed this year, Macfarlane said.
A government-appointed panel recommended in August that Australia weaken or phase out the target in favor of a lower-cost approach to cutting greenhouse-gas emissions. Speculation that Australia will dismantle the RET has unsettled an industry that has seen A$20 billion ($17.6 billion) of investment since the country set goals for clean energy in 2001.
Origin Energy Ltd. and other large utilities have opposed the requirement that Australia produce 41,000 gigawatt hours of electricity from large-scale renewable projects by 2020. The government says the gigawatt-hour figure, which was supposed to represent 20 percent of the market, is actually heading toward 26 percent amid shrinking electricity demand.