Weekly Climate and Decarbonisation Update (1 August)
Climate Politics
Labor supersizes renewables subsidy scheme (The Australian Financial Review): Labor will significantly increase the number of renewables projects it will underwrite in a bid to speed up the clean energy rollout as the government’s 2030 climate targets look increasingly out of reach. Climate Change and Energy Minister Chris Bowen will on Tuesday announce a 25 per cent increase to the size of the Capacity Investment Scheme, Labor’s program to boost private investment in renewables by providing minimum revenue guarantees for new clean energy projects.
Labor risks ‘buying failure’ with supersized renewables subsidies (The Australian Financial Review): Former Labor climate adviser Ross Garnaut says the supersizing of subsidies for solar and wind projects won’t get Australia to its 2030 clean energy targets and risks blowing a hole in the country’s budget just to “buy failure”. Climate Change and Energy Minister Chris Bowen on Tuesday announced a 25 per cent increase to the size of the government’s flagship renewables subsidy program as it attempts to increase the languid pace of the energy transition.
UN climate chief warns Australia not to pick a ‘bog standard’ 2035 carbon emissions target (The Guardian): The UN’s climate chief has declared Australia’s 2035 emissions target will define the country’s future, and urged the Albanese government to not pick a “bog-standard” number but to “go for what’s smart by going big”. Speaking in Sydney on Monday, the UN Framework Convention on Climate Change executive secretary, Simon Stiell, cast the government’s decision on the target – due by September – as the country’s “one shot” to build an “on-ramp to the Asian clean tech boom”, create hundreds of thousands of jobs and ensure the country’s economic security and regional influence.
Climate targets ‘easier set than met’: Energy Minister Chris Bowen (The West Australian): Energy Minister Chris Bowen has argued targets are “easier set than met” following increased pressure from the United Nations for Australia to speed up its efforts to tackle climate change. UN climate chief Simon Stiell has urged the Albanese Government to “not settle for what’s easy” when fixing its 2035 emissions target on the path to a global net zero carbon emissions goal by 2050 — a milestone commitment expected to be announced by Labor in weeks. Mr Stiell, who is in Canberra on Tuesday for meetings with Mr Bowen and other Cabinet ministers, told a Smart Energy Council event on Monday that fruit would be a “once-a-year treat” if Labor did not step up its clean energy ambitions.
Tax fossil fuel exports or risk losing revenue to other nations, says Zali Steggall (ABC News): Climate change has been left on the sidelines of the government's upcoming productivity roundtable, Zali Steggall warns, as she pitches a proposal to ensure Australia collects on fossil fuel exports rather than foreign nations. The federal government is hosting the event in search of new solutions to overcome Australia's falling productivity, which risks limiting incomes and the overall quality of life for Australians. Ms Steggall said climate change was already hurting the economy and weighing on the federal budget, pointing to record-breaking floods in NSW and Queensland earlier this year and the ongoing algal bloom in South Australia, killing marine life in the thousands.
Carbon-capture’s $66n boost as net-zero support surges (The Australian): Madeleine King will launch a report revealing an east coast carbon capture storage network could add $66bn to the economy, as polling shows surging post-election support for net zero.
Labor willing to help Joyce blow up Coalition over net zero (The Australian Financial Review): The Albanese government will allow the Coalition to debate Barnaby Joyce’s private member’s bill on net zero emissions for as long as it wants, to help highlight the division it is causing in the Coalition. As Joyce made good on his pledge to short-circuit the policy review process put in place by leader Sussan Ley and moved to abolish net zero emissions by 2050 immediately, Liberal senator Dave Sharma pushed back, saying the public did not care what the Coalition thought about net zero.
A solar farm approved in weeks shows how renewables rollout could be sped up (ABC News): A solar farm in Nationals heartland has been given federal approval after just 30 business days, which Environment Minister Murray Watt says is evidence of how the renewables rollout could be dramatically sped up if ageing environment laws were rewritten. The government is also using the speedy approval of the 90-megawatt Summerville solar farm in Nationals deputy Kevin Hogan's seat of Page to twist the knife into the opposition, as the Coalition fights over its commitment to net zero emissions.
CEFC investments hit record $4.7b as grid bill climbs (Australian Financial Review): The head of the federal government’s green bank expects investment commitments to scale a new peak this financial year, beating the $4.7 billion record achieved for last year, as long as a commitment is made to construct the Marinus Link power cable between Victoria and Tasmania. Ian Learmonth, chief executive of the Clean Energy Finance Corporation, said that in non-power grid areas, he was optimistic of a further increase in investments, but that the $3.9 billion Marinus Link project was “the biggest swing factor” for the total for 2025-26.
CSIRO report shows firmed renewables remain lowest-cost option (PV Magazine): The Commonwealth Scientific and Industrial Research Organisation’s (CSIRO) final GenCost report for 2024-25, compiled in collaboration with the Australian Energy Market Operator (AEMO), shows integrated renewable energy remains the lowest-cost form of new generation. Gas with carbon capture and storage and large-scale nuclear are the next lowest-cost options, but as neither are currently deployed for electricity generation in Australia, they could be subject to longer lead times and first-of-a-kind premiums. Small modular nuclear reactors remain the highest-cost option.
VNI West costs double amid calls to scrap major energy projects (The Australian Financial Review): The contentious VNI West transmission project in Victoria is likely to almost double in cost to more than $7 billion, fuelling calls to scrap it and other power cable schemes needed to underpin the transition to clean energy. The costs of building major transmission infrastructure needed to connect new large-scale solar, wind and battery projects to the electricity grid have increased by up to 100 per cent since 2024, according to a report released on Thursday by the energy market operator. Victorian opposition energy spokesman David Davis said households and businesses would feel the pain of the rising infrastructure costs via a spike in electricity bills.
Farmers face fines for blocking access during transmission line projects under plan (ABC News): Farmers are vowing to stop transmission line builders from using their land, despite the threat of large fines and clashes with police. The Victorian government plans to change legislation around land access for transmission project construction, which would introduce new penalties and give authorities the ability to use force if needed. The proposed amendments to the National Electricity Bill are expected to be debated in state parliament this week. The law change would facilitate the design and construction of new transmission projects like VNI West and the Western Renewables Link (WRL), which are key parts of the government's renewable energy transition. The projects have faced huge opposition from landowners and sparked numerous protests.
Clean energy companies will evacuate to Australia, says US expert (The Australian Financial Review): Australia may become the beneficiary of Donald Trump’s war on renewables, says a former senior Biden administration energy official, but will need to do more to promote itself as a destination for renewables-based investment. Jigar Shah is in Australia to meet with government and private sector leaders to discuss how shifts in US policy under Trump offer opportunities for Australia to attract major international renewable energy projects.
Australia expands 2030 renewable target by 18 GW after COP28 pledge (PV Magazine): Australia is one of only seven countries outside the European Union that have updated their 2030 national renewable energy targets, adding 18 GW since the 2023 COP28 global tripling pledge. A new report by UK energy retailer Ember Energy, titled “What’s new with national renewable targets? Not Much!,” finds that most countries that committed to tripling renewable capacity have not taken adequate steps to meet that goal. The report covers 96 countries and the European Union as a bloc. Together, they account for 97% of global renewable capacity, 96% of electricity sector demand, and 96% of power sector emissions as of 2024.
Corporate Social Responsibility
Big super lobbies Ley, Canavan to back renewables investing dream (The Australian Financial Review): Some of the country’s biggest retirement savings funds have been meeting with senior Coalition figures to press them to put aside their infighting about climate change and pave the way for them to spend billions of dollars on the energy transition in regional areas. Major investors including Rest Super, Cbus, First Sentier and BNP Paribas delivered the message to Opposition Leader Sussan Ley, Coalition energy spokesman Dan Tehan and Matt Canavan, the Nationals Party senator who has been an outspoken critic of emissions reduction targets.
Big investors call for FIRB, super reforms to keep rivers of foreign gold flowing into clean energy (Renew Economy): The Clean Energy Investor Group (CEIG), a lobby group representing major investors, wants foreign investment rules to be tidied up to ensure that offshore capital can continue to flow into Australian renewable energy projects. About 70 per cent of the funds needed to pay for future clean energy projects are expected to come from overseas investors, and the CEIG is worried the rivers of gold are at risk if key changes aren’t made. “Policy and regulatory barriers, particularly in foreign investment, taxation, and superannuation, are limiting capital flows into sectors critical to long-term productivity and economic resilience,” the CEIG’s Marilyne Crestias wrote in a submission to the federal productivity roundtable.
Corporate Australia keeps climate talks behind closed doors (The Australian Financial Review): Australia’s top business lobby is likely to withhold its view on a 2035 emissions reduction target until after the Albanese government makes its own decision, despite commissioning detailed research on the topic. The Business Council of Australia, which represents 130 of the country’s biggest corporates, has been briefing its members on emissions policy modelling it commissioned more than 12 months ago, but has yet to decide if it will take a position or make it public.
‘New regional order’ to tackle resistance to the energy transition (The Energy): A “new regional order” for getting a social licence, how to tackle winter energy droughts, and a strong 2035 climate target are top issues for developers, investors and equipment makers at a summit in Sydney. Kane Thornton, hosting his last Clean Energy Council conference as the industry body's chief executive, said the sector needed to shift from political advocacy to community advocacy. "That’s got to be genuine. It’s about sharing relevance. It’s about breaking down myths. It’s about informing and educating people," he said. Rob Wheals, CEO at Squadron Energy, said there’s a lot more resistance, and clear feedback about the need to start doing community consultation differently.
‘Steam out their ears’: Australians fired up about gas exports (The Australian Financial Review): New research backs the push for Australia’s gas exporters to set aside gas for domestic use, with a near total majority of voters across the political spectrum supporting the creation of a domestic gas reserve. The Albanese government is considering new domestic price and supply arrangements as part of a major review of Australia’s east coast gas market, which it launched in June amid a febrile public debate over gas prices and their effects on households and industry.
Renewables developers shift focus in search for project sites (PV Magazine): The head of Sydney-based land acquisition agency Rok Solid says there’s been a significant shift in Australia’s renewable energy sector with developers now favouring project sites that have already been progressed through early-stage approvals and grid studies. “We’re entering a new chapter in Australia’s renewable energy transition, one where the race for land is no longer about acquisition alone, but execution,” Rok Solid Chief Executive Officer Daniel Moroko said. “The market is maturing, and the real winners will be those who can take a site from concept to commissioning, navigating complex hurdles like grid access, community engagement, and planning approvals.”
Carbon Markets
Garnaut says carbon price could solve budget black hole and fill funding gap from LGC collapse (Renew Economy): Collapsing large-scale certificate (LGC) prices and the rising cost to government budgets from supporting renewable energy investments, could be neatly solved with a carbon price, says Superpower Institute director Ross Garnaut. On the same morning that federal energy and climate minister Chris Bowen revealed a 25 per cent boost to the size of the Capacity Investment Scheme, which the federal government uses to underwrite new wind, solar and storage projects, Garnaut said a smarter alternative would be to boost falling LGC prices could dovetail with revenues from a carbon price.
Green Projects and Initiatives
Construction begins on 30 turbine expansion to deliver state’s biggest wind farm (Renew Economy): Construction of a 103-megawatt expansion to the Warradarge wind farm that will make it the biggest wind farm in Western Australia is underway near the town of Eneabba, around 300 km north of Perth. The $400 million expansion was confirmed in January by Bright Energy Investments, a joint venture between Synergy, Cbus Super and CVC DIF, with a $30 million contribution from the WA government as part of its $5.7 billion clean energy future investment.
Private equity giant KKR takes $500m punt on solar and storage start-up (The Australian Financial Review): Private equity giant KKR is ploughing $500 million into a solar and storage start-up co-founded by a former Citi banker, in a landmark investment in the sector targeting rooftop panels and battery installations on shopping centres and industrial premises. The investment in CleanPeak Energy is being made under the global powerhouse’s climate transition strategy, which has so far committed more than $US34 billion ($51.9 billion) to climate and environmental sustainability ventures.
AGL powers up inaugural community battery project (Energy Magazine): AGL has unveiled plans to build 11.2MW and operate 11.5MW of community batteries across South Australia. In partnership with the South Australian Government, AGL’s emPowering SA1 community battery project aims to facilitate cheaper electricity to social housing tenants and people experiencing financial hardship. The 16 new, 700kW/1828kWh batteries as well as the South Australian government’s two recently commissioned community batteries at Magill and Edwardstown, will join AGL’s multi-asset virtual power plant (VPP) and deliver 11.5MW of flexible storage assets in total.
NSW opens tender for energy firming projects (Energy Magazine): To enhance the reliability and security of the state’s energy grid, the New South Wales Government is directing a tender for projects that deliver 500MW of firm capacity. The State Government said that this move is crucial to ensure New South Wales residents and businesses have reliable power when they need it most, especially during high-demand periods like heatwaves or cold snaps. The tender will seek bids for firming infrastructure like batteries, gas generation and virtual power plants, that can rapidly supply electricity to the grid or reduce the use of electricity at short notice.
OX2 solar and storage project clears federal review in Australia (PV Magazine): The Summerville solar and battery energy storage project, developed by Swedish renewables firm OX2 near Lismore in northern New South Wales, has received Australian federal environmental approval with no conditions. Australia Environment Minister Murray Watt said the project had been given the all-clear after being referred for assessment under the Environment Protection and Biodiversity Conservation (EPBC) Act just over a month ago. “This project is an example of good design and site selection leading to fast approval times and ultimately delivering reliable, renewable energy with minimal impact to the environment,” he said. “And I recognize the plans to maintain grazing on the land, as part of state government approvals, demonstrating once again that there’s ways for renewables and agriculture to work together.”
Transgrid upgrades for reliable clean energy grid (Energy Magazine): To manage complexities as more renewable energy enters the grid, Transgrid is proposing a $179.2 million smart control room upgrade. This upgrade aims to enable the utility to continue maintaining reliability and efficiencies for both generators and consumers as Australia transitions to clean energy. Transgrid Acting Executive General Manager of Network, Jason Krstanoski, said the utility’s control rooms operate around the clock, and are the nerve centre of the New South Wales and ACT high-voltage electricity network, ensuring the safe, secure and reliable flow of power, particularly during system events.
Australia Post delivers rooftop solar to Queensland sites (PV Magazine): Australia Post has commenced the rollout of 1.225 MW of solar generation capacity across the rooftops of 11 of its operational sites in Queensland. The program will also deliver three 50 kW battery energy storage systems. The federal government-run mail carrier said a 45 kW rooftop system has already been installed at its Coorparoo facility in Brisbane’s southern suburbs while an 80.1 kW PV array and 50 kW battery have been deployed at its Logan City site.
Other Matters of Interest
Bad bidding behaviour: Big batteries the dominant force as daily electricity prices pushed to record highs (Renew Economy): Australia’s growing fleet of big batteries are now entrenching themselves as the major force behind the huge price spikes that have become a regular feature of Australia’s National Electricity Market, and which were the dominant factor in soaring wholesale prices in the June quarter. Big batteries had been expected to be a softening influence on price spikes on the grid, given their cost of fuel (charging) is significantly lower than peaking gas stations, and based on the assumption that they would bring new competition to the market. But market power is market power, whatever the technology that is deployed. The costs of battery storage may well have fallen, but their market power has grown, and so has their asking price.
“We’ve got more thinking to do:” Coal giants say home batteries will reshape and “minimise” the grid (Renew Economy): The head of one of the country’s biggest energy retailers and coal generation companies admits that the industry has some “thinking to do” as the huge uptake of household batteries – driven by federal government rebates – change the nature of the grid and the market they have long dominated. Mark Collette, the boss of EnergyAustralia, which owns the Yallourn and Mt Piper coal fired power stations in Victoria and NSW respectively, says everyone should be looking at how home batteries can “minimise” the size of the grid. “[The battery subsidies] are massive, and they will encourage the growth of a big industry, which changes the nature of how the grid actually works,” Collette said this week during a panel session at the Australian Clean Energy summit in Sydney.
When copper gets political the energy sector pays (The Energy): US President Donald Trump’s 50% tariff on copper is due to come into force on Friday, though the plan remains scant on detail. We don’t yet know if all countries will be hit equally - America’s largest copper trading partner Chile is seeking an exemption in trade talks this week. Australia is a top 5 exporter of copper, but less than 1% goes to the US. Still, experts say the move could destabilise global supply chains at a time when global copper markets are already facing geopolitical uncertainty and tight supply. When the Australian government issued its 2023 Critical Minerals Strategy planning out to 2030, few would have foreseen the geopolitical environment now facing the world as the US embraces protectionism.