by Kerrie Sinclair
The Courier Mail
2nd September, 2014
PRIME Minister Tony Abbott’s renewable energy review, which he claimed was to help lower power prices, would result in raising household power bills, one of Australia’s largest foreign investors has warned.
General Electric, whose energy financing arm has a $9 billion global renewable energy portfolio, in a statement said if either of the Warburton review’s two options for reform of the large-scale renewable energy target were adopted it would be an unworkable policy.
The review’s recommendations, issued last week, to close the large-scale RET to new investment or set targets on an annual basis, would swell power bills and throw a shadow of sovereign risk over the entire Australian economy, GE said Tuesday.
GE managing director of sales and project finance Jason Willoughby said the review had demonstrated, as had the Climate Change Authority review of 2012, a near negligible impact on household power bills and downward pressure on wholesale power prices as a result of the current RET.
“However, the (Warburton) panel’s two options for the future operation of the large-scale renewable energy target would risk reversing these benefits, particularly for household electricity bills, and undermine the government’s open-for-business approach within and beyond the renewable energy sector.”
Last week Mr Abbott, who chose a climate sceptic to head the RET review, said his government wanted to “try to ensure we use renewable energy in ways that don’t lift the price of power”.
GE, which has invested A$800 million in energy projects in Australia, says altering the RET would alarm international investors.
“Changing legislation regarding projects that have a 25-year lifespan has an impact on investor confidence,” Mr Willoughby said.
He said the Abbott government’s decision to release the RET review report last week prior to making a decision on the renewable energy target – it currently requires 20 per cent of Australia’s electricity to be sourced from climate-safe sources by 2020 – shows its preparedness to consult on a “workable way forward”.
“GE is committed to work with the Government ahead of its formal response,” Mr Willoughby said.
In July GE’s vice chairman, John Rice, said the company’s $3.5 billion pipeline of investment in green energy in Australia was at risk because of possible changes to the RET.