Australia’s renewables transition is weel under gait – but meetin its 2030 target will be ‘extremelie challengin’

The challenges o Australia’s energy transition – frae a system aince fired bi coal an gas til ane pouered bi solar, wind an supportin technologies – are bein underlinet on an almost weekly basis.

On Tysday, the Carroll Labor government in Victoria announcit a review o the Western Renewables Link, a major transmission line due tae be completit in 2029, only days efter scrappin ane o its renewable energy zones. An, gin there is a chynge o government at the state election in November, the Coalition is expectit tae gang further.

Queensland muved aheid wi plans for the nation’s lairgest datacentre, haein rejectit the federal government’s push tae pouer the industry wi renewables.

It means that, while frae ane perspective the shift tae clean energy is weel under gait, wi aboot half the electricity in the main grid suppliet bi renewables, the neist stage cud be even mair demandin. It has left some speirin whether the country can still reach the Albanese government’s target o 82% renewable energy bi 2030.

The 82% figure wasna meant tae be a target – it startit as a projection o whit was possible afore Labor was electit in 2022, but morphit intil a national goal in the months efterwarts. At the time wind, solar an hydro made up a third o the country’s electricity.

Back then, the target was ambitious, but wad hae been achievable wi sustaint effort an investment, says Dr Dylan McConnell, an energy systems researcher at the University o New South Wales.

But fower years oot frae 2030, the remainin gap looms lairge. An additional 8.5GW o wind an 9.5GW o solar needs tae be plannit an built, McConnell says, drawin on data frae the Australian energy market operator. In capacity terms, that is addin mair than the nation’s entire existin wind pouer resources, but in the neist three an a half years. That is ower an abuin whit the market operator already anticipates tae come online.

“It is an extremelie challengin task. The rate o renewable energy rollout that is noo required tae hit that target is unbelievable,” McConnell says, an rapidly growin demand frae datacentres is aboot tae mak things harder.

Tristan Edis, the director o analysis an advisory at research an analytics firm Green Energy Markets, says there is sufficient capacity in the pipeline – already approvit under plannin an environmental laws – tae meet the government’s 2030 target. But only aboot 12% o whit is needit is currently under construction.

Whit that shaws, he says, is environmental assessments arena the key haud up. “That is no the predominant reason why sae little is managin tae get committit tae construction,” he says. “The choke pynt is that projects arena able tae find a customer that is preparit tae sign on til a lang-term pouer purchase agreement sic that they can get the project financit.”

Why? Edis says uncertainty aboot coal closure plays a big part. Twa big generators – Yallourn, in Victoria’s Latrobe Valley, an Eraring, in the Hunter Valley – are schedulit tae close afore 2030. But past experience shaws governments hae a tendency tae intervene tae delay exit dates.

“We are stuck in a vicious cycle where fowk are nervous, or lackin sufficient confidence that they are goin tae let the coal close, sae they dinna invest in the new renewables tae replace it,” he says.

That is couplit wi insufficient policy signals tae drive the new investment.

The capacity investment scheme, the government’s cornerstone policy for new renewable energy has been slaw tae deliver.

Initially designit tae support batteries an ither firmin, the scheme’s scope an size was expandit in 2023 an 2025 tae include renewables alangside dispatchable capacity – totallin 40GW – aboot half the current capacity o the national electricity grid.

Aicht tender roonds hae supportit 115 projects, includin 25.5GW wind an solar. But the level o financial support providit bi the government means that maist projects also require a contract for their electricity, afore they can start buildin.

Those pouer purchase agreements haena been forthcomin at the rate needit tae match the target, an only aboot 11% o the underwreitten wind an solar farms hae reachit construction or operation, accordin tae analysis bi Green Energy Markets an the Institute for Energy Economics an Financial Analysis.

The Australian Energy Council’s chief executive, Louisa Kinnear, says there is a need for “durable an stable policy settins” includin greater certainty aboot when coal will exit, an plannin aheid for reliability an security.

“Ye end up in a sort o catch-22 where we ken we need tae stimulate investment in new generation sae that coal can exit, but while coal remains in the system, prices are ower low an no providin the richt signal,” she says.

Chris O’Keefe, the national spokesperson for the Clean Energy Council, says recent policy chynges at the state government level in Queensland an Victoria haena helpit. “We are seein quite a feisty debate in Victoria, where major transmission projects – VNI West – are proposit tae be cancellit bi an incomin Coalition government.

“Then ye hae the Western Renewables Link, where unfortunately the Labor government, as weel as the Coalition, hae said they will pause it.”

Delay disna mak projects cheaper, he says. “It is very disappointin frae an industry perspective because decisions like this dinna build the electrons an the electricity supply Victoria will need as seen as Yallourn closes in 2028.

“We need tae ensure that the goalposts dinna shift when the politics gets hard.”

A recent industry survey foond 85% o renewable companies, investors an regulators said connectin tae the grid was the leadin risk for new projects, while 81% said approvals still remainit a significant barrier.

Analysis bi Net Zero Australia, a research partnership that tracks Australia’s progress on the energy transition, foond renewable projects were gettin lairger an mair complex, an takin langer tae design an approve. But the rate o approval per megawatt was improvin.

Prof Michael Brear, a University o Melbourne engineer an the project director o Net Zero Australia, says it is quicker tae build a windfarm than tae design an approve ane. “It taks roughly aicht years frae first thocht tae turnin on a windfarm, an we spend aboot five o those aicht years designin the thing an gettin it approvit.”

Governments cud help things gang faster, he says, bi mappin biodiversity an identifyin pairts o the country where projects cud be fast-trackit an ither high-value nature areas that shud be protectit.

Nane o this is tae say progress isna happenin. Mair wind an solar was addit tae the grid last year than in 2024. In the final quarter o 2025, renewables generatit mair pouer than fossil fuels for the first time ever.

Governments canna afford tae tak their fuit aff the pedal, Edis says, because renewables underpin the cuts required tae meet Australia’s 62-70% emissions reduction target in 2035, as ither sectors includin industry, transport an buildings electrify.

The energy minister, Chris Bowen, remains confident the target can still be met, tellin the Australian Financial Review: “The closer we get til it, the better the country will be.”

Despite the setbacks, O’Keefe agrees: “There is nae question it is a challenge, but it is doable.”

Mair than 70 renewable energy projects are noo at financial close or under construction, he says, alang wi a similar number o big batteries. “We still need mair, but that is no nothin,” O’Keefe says.

It is important no tae discount whit has already been achievit, he says, especially gien the country’s first solar farm was switchit on only 12 years ago. “I dinna think Australians realise we are halfway through the transition,” O’Keefe says.

“Aye, some o the targets are goin tae be challengin tae meet. But that disna mean ye dinna strive tae meet them … Gin ye hae half built your hoose, it is a better idea tae keep gaun.”