Coalition Carbon Tax hole

A vey interesting report from research group RepuTex says that a Coalition government policy of abolishing the Carbon Tax would immediately halt investment in the renewable energy sector. Wind farms planned for the future to support Australia's renewable energy target (RET) are at greatest risk of not proceeding.

As described in The Sydney Morning Herald article (27 March, 2013), the carbon  price ($23 per tonne) and renewable energy certificates (currently $32 per megawatt-hour) both work in tandem for wind farms to be viable at the current wholesale price of power. 

Taking out the carbon tax would result in the collapse of investment in wind farms, including other renewable energy projects. This is the conclusion of RepuTex.

The Coalition's climate change spokesperson Greg Hunt, an economist himself, rejects RepuTex's findings. His views reported in the SMH article do not seem to be shared by others. For example, AGL's chief economist says that removing the carbon price would require "something to fill the gap for wind farms to retain their profitability".

Very interesting. Given that the federal election is still some way off (September 14), it is also reported that "many projects are on hold as investors ponder future policy changes".

For South Australia, the carbon tax has now become a pivotal factor in proposed wind farm projects, particularly the vary large project for Yorke Peninsula.

Strip away the carbon tax, and what's left? Probably an empty project.

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