Scrapping Australia’s renewable energy target could cost billions in potential investment and cost thousands of jobs, according to a report.
The ABC reports that financial news and data firm Bloomberg has warned that changes to the current renewable energy target of 20 per cent of power by 2020 would hit the clean energy industry hard.
Australia's renewable energy target is currently being reviewed by an expert panel. It follows the federal government’s decision, made in last Tuesday’s budget, to axe the Australian Renewable Energy Agency.
The lead author of the Bloomberg report, Kobad Bhavnagri said that the existing target is expected to drive about $35 billion of investment in clean energy by 2020.
"If that was cut, $21 billion of that would not get spent, and if it was reduced we'd expect that about $12 billion less would be invested," he said.
Bhavnagri added that cutting the target would reduce competition among the existing fossil fuel power generators. He said that “... more energy will need to be supplied by coal and gas-fired generation which is expensive at the time of production."
"That puts upward pressure on wholesale electricity prices," he said.
Bhavnagri’s concerns are shared by the world’s largest manufacturer of wind turbines, Vestas Wind Systems which claimed that over $10 billion in value for the country’s largest projects is at risk.
And, according to the Danish renewable energy giant, another $15 billion in projects and 18,000 jobs could be compromised.