In February the Coalition Government surprised the sector with its announcement that it would ban the conventional incandescent light globe, moving well beyond its past timid approach to energy efficiency.

In the budget the Coalition Government announced that the photovoltaic (PV) rebate program would be extended to a five year period, rather than the extraordinary uncertainty of a two year program that we had to deal with prior to the budget. What’s more, the rebate was doubled from a maximum of $4,000 per kilowatt to $8,000. This has already seen a boom in the residential PV industry, with a tripling in the rate of installations.

In June the Coalition Government finally saw sense and agreed to implement a national emissions trading scheme, dropping its previous, unrealistic condition that this would only occur once every other country in the world also took on binding limits on emissions. But at the same time the Government threatened to abolish state government schemes that supported renewable energy.

In July the Coalition Government announced a major rebate program for solar hot water, providing $1,000 per system for households with incomes less than $100,000.

Then in September the sector breathed a sigh of relief when the previous Government dropped its threat to abolish state government renewable energy schemes and instead chose to consolidate them into one national Clean Energy Target.

In many respects these Coalition policy announcements prior to the formal election campaign meant much of the battle had been won. Labor’s long held policy positions were already closely aligned with those of the Clean Energy Council. An expansion of mandatory renewable energy target (MRET), ratifying Kyoto, implementing an Emissions Trading Scheme, a commitment to deep emission cuts by 2050, and expanding the Solar PV rebate program were already part of Labor Party policy for several years.

The key gaps for Labor were the lack emissions target for 2020; gaining a substantial expansion in the scale and scope of energy efficiency initiatives; locking in what was meant by a ’substantial’ increase in MRET; and, support for renewable energy and energy efficiency research and development.

The substantial increase in MRET eventually came, with Labor meeting the Clean Energy Council ask for a 20 per cent renewable energy target. This is a landmark policy for the renewable energy sector. It will drive substantial and sustainable growth with major project stimulus ongoing for the next decade. This kind of sustained and secure growth is an essential precondition for investment confidence and a viable industry.

In addition the sector saw some important announcements in the energy efficiency area. These included financial support: a low interest loans program; a rebate for insulation in rental properties; a $90 million Green Building Fund; $75 million for upgrading energy efficiency in small and medium sized manufacturing businesses; a $489 million solar and energy efficiency schools program; and agreement to match rebate announcements from the Coalition. There were also some commitments for further energy efficiency regulations: the phase out of electric storage water heaters; and to upgrade energy efficiency standards for new and existing homes. Most critically the Labor Party has announced a target that Australia be ‘at the forefront of OECD energy efficiency improvement’. This necessitates a broad ranging strategy that will build on and go beyond the policies Labor announced during the election campaign.

In terms of research and development Labor came forward with a very substantial set of initiatives. They will provide $500 million specifically for pre-commercial renewable energy projects, similar in its operation to the Low Emission Technology Demonstration Fund. Also $75 million will be made available to support small businesses in development and introduction of green products and technologies. And $150 million will support early stage research in solar energy, energy efficiency, and energy storage.

In terms of a 2020 emissions target the Labor Party deferred the final decision based on the outcomes of the Garnaut Review due to report mid-way through 2008. Nonetheless there is not much room for growth in emissions if Australia is to get itself on track to 60 per cent reductions by 2050. Also, Kevin Rudd has acknowledged this need to make reductions by 2020 rather than just slow the growth of emissions. In a speech he delivered on 30 May 2007 he set out several tests for what he saw as an effective emissions trading scheme including,

“An effective emissions trading scheme must effectively reduce emissions. Such a scheme must stop further growth in Australia’s emissions (my emphasis) and set Australia on a path to reduce emissions by 60 per cent by 2050 – the minimum required to avoid dangerous levels of climate change.”

In Rudd’s 14 November 2007 clean energy R&D announcement his press release declared, “Under a Rudd Labor Government, emissions will go down”. Work by the IPCC suggests that if we are to stabilise the concentration of greenhouse gases in the atmosphere at between 450 and 550 parts per million (which Labor has acknowledged as a necessary goal), wealthy developed countries such as Australia must begin reducing their annual emissions almost immediately. Based on Labor’s long term emissions target and past statements there is little room for them to adopt a 2020 emissions target that would involve emissions being higher than they are today. Indeed the science would suggest they need to set a 2020 target well below current emission levels.

Overall this past 12 months has been one of considerable achievement on the policy front. The next 12 months will be equally important as the clean energy sector works with the new Federal Government to ensure election commitments are properly implemented.