Investor concern may impact Australian emission target

Significance

Although one-third of Australian electricity now comes from clean sources, a series of regulatory issues and infrastructure project delays is leading to an exodus of private investors from the renewables sector. The government will use taxpayer funds via the Capacity Investment Scheme to bolster support as ageing coal-fired plants close over the next decade.

Impacts

• Uncompetitive coal plants will close sooner than expected, with possible consequences for grid reliability.
• While Labor will remain opposed to nuclear power, opposition parties may back new investment in the sector if they win the 2025 election.
• Community opposition is delaying vital transmission lines needed to carry additional capacity from renewable energy locations.