However, a target set for a time 15 years into the future and without any commitment to policy mechanisms on how to get there isn’t worth much to investors and in fact could actually be bad for investment in renewable energy projects.

How could it possibly be bad for investment?

Imagine you’re about to build a wind farm and 50 per cent of the revenue relies on the price of renewable energy certificates power retailers need to buy to meet a 23.5 per cent RET. Then along comes a government that says, ‘we won’t obligate power retailers to buy any more renewable energy than 23.5 per cent, but we’re going to implement a bunch of other, currently undetermined policies that will drive the supply of renewable energy soaring above 23.5 per cent’.

Demand is 23.5 per cent of electricity, supply will be 50 per cent of electricity, and 50 per cent of your revenue is at risk – can you understand why a financier might get very nervous contemplating an investment right now?

Now of course there’s some upside, you’ll get an emissions trading scheme introduced too – but what’s that worth?

Joel Fitzgibbon reckons it could be worth not much – noting that the eligibility of international credits would have made it drop to $10. Indeed if the emissions trading scheme was open slather to all UN international carbon credits, the price would be less than 50 cents. By comparison a renewable energy certificate is currently worth about $50.

Not much of a replacement is it?

There are range of deluded greenie optimists out there that think renewable energy is on some kind of unstoppable path of cost reductions that nothing can stop it and government simply needs to “get out the way”.

They don’t have a clue.

http://www.businessspectator.com.au/article/2015/7/27/policy-politics/labors-50-renewables-target-joke