Transitional assistance for waste coal mine gas under the renewable energy target
Minister for Climate Change and Water, Senator Penny Wong, announced an amendment that will see the Renewable Energy Target (RET) 'topped up' to allow existing waste coal mine gas projects to generate Renewable Energy Certificates. The Government is conscious that cessation of the New South Wales Greenhouse Gas Reduction Scheme and the transition to the Carbon Pollution Reduction Scheme may impose a significant cost on existing electricity generators using waste coal mine gas. Affected companies have indicated that currently profitable projects could be forced to close.
Senator Wong said the decision to increase the target to include waste coal mine gas had not been taken lightly. She said the amendment guaranteed there would not be a single megawatt-hour of renewable energy replaced by waste coal mine gas generation. “Waste coal mine gas is not a renewable energy source and is not intended to contribute to the 20 per cent target for renewables in 2020,” Senator Wong said.
The amendment will increase the annual targets under the RET for the years 2011 to 2020 inclusive to ensure the inclusion of waste coal mine gas under the RET does not displace renewable energy generation.
Minister Combet said the amendment will ensure the Government is able to deliver on its commitment to achieving 20 per cent of renewable energy in Australia's electricity mix by 2020, while meeting the need for transitional assistance for the waste coal mine gas generation sector. “Inclusion of waste coal mine gas in the RET helps to ensure these entities continue to remain viable and are able to make a valuable economic and environmental contribution,” Mr Combet said.
Senator Wong and Mr Combet thanked Labor Members of Parliament — in particular Kirsten Livermore, Shayne Neumann, James Bidgood and Chris Trevor — who have worked to address the concerns of waste coal mine gas generators in their electorates.
This amendment addresses another one of the concerns raised by the Opposition.
The amendment will be moved in the House of Representatives today.
Supporting Information
The Government will introduce an amendment to the RET legislation allowing existing waste coal mine gas generation projects to be included in the RET, as a transitional assistance measure. This will apply from 1 July 2011 until 31 December 2020. To clearly differentiate waste coal mine gas from renewable energy sources, the amendment creates a new concept of an 'eligible energy source' that comprises the current list of eligible renewable energy sources, and separately, eligible waste coal mine gas.
Eligibility will be limited to waste coal mine gas-fuelled power stations currently in operation. Annual limits will be placed on these power stations' ability to create Renewable Energy Certificates (RECs) based on their 2008 output levels.
To ensure the inclusion of waste coal mine gas under the RET does not crowd out renewable energy generation, the amendment will increase annual targets under the expanded RET scheme for the years 2011 to 2020. The target for 2011 will be increased by 425 gigawatt-hours to account for the half-year of eligible generation, and the annual targets for 2012 to 2020 will be increased by 850 gigawatt-hours. Total eligible waste coal mine gas generation will be capped at 425 gigawatt-hours in 2011 and 850 gigawatt-hours for the years 2012 to 2020; equal to the amount by which the annual targets are increased under the RET.
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