Victoria commits to 25% renewable energy by 2020

The Victorian Government has furthered its commitment to reducing greenhouse gas emissions, promising that 25% of electricity generated in the state will come from renewable energy by 2020 — up from 14% today. By 2025, that number will rise to 40%.

Announced by Premier Daniel Andrews and Minister for Energy, Environment and Climate Change Lily D’Ambrosio, the news comes less than one week after the government pledged a long-term emissions reduction target of net zero greenhouse gas emissions by 2050.

“We’ve developed Victorian renewable energy targets that generate thousands of new jobs, particularly in regional Victoria, while also cutting Victoria’s greenhouse gas emissions,” said D’Ambrosio.

It’s anticipated that by 2025, up to 5400 MW of new large-scale renewable energy capacity will be built in Victoria, representing an estimated $2.5 billion of investment in the state. This will mean more than 4000 additional jobs in the renewable energy sector during the expected peak year of construction in 2024 and around a 12% reduction in electricity sector greenhouse emissions by 2034–35.

The Premier also announced an auctions scheme — running a series of technology-neutral auctions, as well as solar auctions — which will see project developers compete to be the lowest cost provider. Successful bids will be given long-term contracts to support their projects, providing certainty for investors.

The Andrews Labor government will work with the renewable energy industry, electricity networks and retailers and consumer groups to refine the details of the scheme, with the first auction of contracts to begin next year. Separate auctions will be held for large-scale solar projects.

According to Environment Victoria CEO Mark Wakeham, the new clean energy targets will see Victoria “double its wind power capacity by 2020 and quadruple it by 2025, as well as supporting large-scale solar projects in the north of the state”.

Wakeham added that the 4000 jobs expected by 2024 will be “more than double the number of jobs Victoria’s coal generators currently provide”. He said, “Regional towns like Portland, where wind turbine towers are manufactured, will also benefit from new manufacturing jobs.”

Clean Energy Council Chief Executive Kane Thornton meanwhile said Victoria’s target of 40% renewable energy by 2025 makes the state “a very attractive destination for clean energy investment at a time when activity in the sector is ramping up significantly”.

“We have seen about 450 MW of projects committed nationally in the past three months alone, so this move by Victoria is smart timing — and should see Victoria claim a big share of the renewable energy pie out to 2025 and beyond,” he noted.

The targets and auction scheme form a key part of Victoria’s Renewable Energy Action Plan, to be released in the coming months. The targets will be enforced in legislation expected to be introduced into Parliament late this year or in early 2017.