The unlucky country: The Abbott government's review of the industry has spooked investors in green energy.
The unlucky country: The Abbott government's review of the industry has spooked investors in green energy. Photo: AFP

Investments in renewable energy rose to record levels
globally in 2014 but fell sharply in Australia because of uncertainty
triggered by the Abbott government's review of the industry, Bloomberg
New Energy Finance said.

Worldwide investment in wind farms, solar photovoltaics and
other clean energy sources jumped 16 per cent last year to $US310
billion ($383 billion), or more than five times the tally of a decade
earlier. Solar investments accounted for almost half the total.

China led the way, with investment soaring almost one-third
to $US89.5 billion, while US investment gained 8 per cent to $US51.8
billion, and Brazil's almost doubled to $US7.9 billion.

Australia, though, went the other way, with investment
sinking 35 per cent to $US3.7 billion. BNEF said the amount was the
"lowest since 2009, as wind and solar project developers delayed
decisions while they awaited the government's response to its Renewable
Energy Target review".

The Australian tally in fact masks a much steeper dive for
large-scale renewable plants as small-scale solar PV largely held its
own in 2014 even as state-based support schemes were wound back further.

"Four wind farms are currently under construction, but these
signed contracts before the last RET review," said Darren Gladman, the
acting policy director for the Clean Energy Council.

"No more projects in the country have imminent construction plans.

"Australia is not just at risk of falling behind the rest of
the world on renewable energy, we have already slipped off the back of
the wave. We have some of the best sun, wind and waves in the world, but
this new research shows that we are squandering some of our huge
natural advantages."

Fairfax Media sought comment from Industry Minister Ian
Macfarlane, who has sought to cut the country's renewable energy target
from the current goal of 41 terawatt-hours annually by 2020 to as low as

So far, the Senate has blocked such a move but uncertainty
over whether and when the goal will be reset has made it almost
impossible to raise financing for new projects.

"Labor has offered to reopen negotiations around the RET in
the interest of returning the policy to the bipartisanship that saw jobs
in the industry triple while Labor was in government," said a
spokeswoman for Mark Butler, the opposition spokesman for the

"However, our negotiating principles remain the same – Labor
will not support any proposal that decimates the industry, including
reducing the RET by 40 per cent."

Australian investors, meanwhile, are pursuing investments in
the industry offshore, with Macquarie Capital this week taking a $1
billion stake in an offshore German wind farm run by Energie
Baden-W├╝rttemberg, and signalling plans for more such outlays.

Miles George, the managing director of Infigen Energy, said
Australia had a chronic oversupply of ageing and inefficient coal-fired
generators that continued "to freely pollute our environment".

"The government initially determined to stick with a
hard-line drastic cut in the [RET], but has more recently indicated it
is prepared to negotiate a bipartisan deal without conditions," Mr
George said. "So the conditions seem to be right for a bipartisan
agreement to be reached."