Renewable Energy

Renewable Energy in Australia

Australia’s electricity generation sector accounts for one third of the nation’s carbon emissions. The deployment of battery and smart metering systems with renewable energy technologies is going to change electricity supply in the same way internet and mobile technology have disrupted telecommunication systems and transformed our consumption of information. Complementary policies that account for the cost of carbon emissions and enable early adaptation to these disruptive changes protect the electricity system from becoming dysfunctional.

Changing Australia’s energy mix

Implemented through large-scale and small-scale schemes, Australian renewable energy policy is designed to reduce emissions of greenhouse gases in the electricity generation sector and encourage the generation of electricity from sustainable and renewable sources. What can Australia’s large-scale renewable energy target achieve by 2020?

  1. Additional capacity of ~6,000 MW prepares Australia’s electricity sector to transition its ageing fleet of coal-fired power stations.
  2. Generation from clean energy, equivalent to powering ~5 million homes, is a significant contributor to Australia’s 2020 carbon emissions reduction commitments.
  3. A thriving renewable energy industry that will create a further 6,500 jobs and $10 billion of investment in Australia’s economy.

How does the large-scale Renewable Energy target scheme work?

The legislated demand creates an incentive for additional generation from renewable energy sources. The scheme operates through tradable certificates known as Large-scale Generation Certificates. Creation of certificates is managed by the Clean Energy Regulator.

Eligible large-scale renewable power stations produce certificates for every megawatt hour of power they generate, creating the supply side of the certificate market. Large end users or retailers of electricity buy these certificates to meet their renewable energy obligations, forming the demand side of the certificate market.

Large end users or retailers of electricity then surrender these certificates to the regulator to meet the renewable percentage target set by the Clean Energy Regulator each year. Certificates are traded at a rate determined by supply and demand of the market, and certificate revenues contribute to the commercial viability of renewable generation.

All of Infigen’s generators are 100% Greenpower Accredited

In addition to the large-scale target, Australians can buy GreenPower certificates for their homes and businesses. By purchasing GreenPower, the equivalent amount of new renewable energy is added to the electricity grid. As a joint initiative of the ACT, NSW, SA, VIC and TAS governments, GreenPower is the only voluntary government accredited program in Australia that enables electricity providers to purchase renewable energy on behalf of households and businesses.


Sources: Renewable Energy (Electricity) Act 2000 (Cth) (REE Act), Australian Energy Market Operator, Climate Council, Clean Energy Council, McKinsey Quarterly