The Clean Energy Council, in its annual report, has highlighted a concerning deceleration in investments in renewable energy projects throughout 2023. According to the council, financial approvals for new solar farms declined by more than a third, while no new wind farms received backing during this period.
This development contrasts sharply with data indicating an expansion in generation from fossil fuel power stations during the initial months of 2024. Heatwaves in eastern Australia spurred increased demand for electricity, leading to the heightened output of fossil fuel power stations.
The council’s report delineates a growing disparity within the renewable energy sector, with significant underinvestment observed in large-scale projects. However, the adoption of rooftop solar panels and investments in both large and small-scale batteries continued to progress robustly.
By the conclusion of 2023, Australia witnessed a decrease in the number of renewable energy projects under construction, declining from 72 to 56 compared to the preceding year. These projects collectively boasted a capacity of about 7.5 gigawatts, representing a reduction of more than a fifth from the previous year’s 9.5 gigawatts.
Of particular concern is the notable decline in new investment commitments, which amounted to $1.5 billion in 2023, significantly lower than the $6.5 billion recorded in 2022. Notably, no new financial commitments were made to utility-scale wind projects in 2023, marking a stark departure from the six commitments secured in the previous year.
The report underscores the critical importance of policy initiatives, such as the federal government’s capacity investment scheme, in stimulating investment confidence and attracting private sector capital. However, sluggish approval processes, particularly in states like New South Wales, pose challenges to achieving the ambitious target of sourcing 82% of electricity from renewables by the end of the decade, as noted by Green Energy Markets.
Efforts to decarbonize the power grid are integral to meeting the government’s emissions reduction targets. However, recent spikes in electricity consumption driven by heatwaves suggest a potential increase in pollution levels, at least in the first quarter of 2024.
Despite these challenges, renewable energy sources supplied a record 39.4% of Australia’s electricity in 2023, with wind energy leading the charge at 13.4%. Rooftop solar also achieved a significant milestone, surpassing a 10% share for the first time.
The report also highlights positive developments in the battery sector, with a notable increase in both large-scale and small-scale battery projects. By the end of 2023, 27 large-scale battery projects were under construction, with a combined capacity of 5 gigawatts or 11 gigawatt-hours. Additionally, the adoption of small-scale batteries in households showed a steady upward trajectory, indicating growing consumer interest in energy storage solutions.