Can the government seal a deal on the RET with the cross-benchers?

Although the debate over the future of Australia’s Renewable Energy Target continues to drag on, recent weeks have seen the stakeholders moving closer than ever toward a compromise.

Looking for an end to the gridlock between the government, the opposition and the senate cross-benchers, it was the Clean Energy Council that blinked first. Knowing that the government had its sights on a target of 31,000 GWh, and with Labor unrelenting on a target in the mid-to-high 30,000s, a compromise position by the leading industry body of 33,500 GWh was thrown onto the table.

Having already budged from 31,000 to 32,000 the government held firm that nothing above their revised target would be entertained. It was reaction from a government pleased to have finally divided a previously united renewable energy industry that had been in lockstep with the opposition.

Now with the blessing of the CEC, Labor agreed to support the 33,500 GWh target. “Every day this matter drags on, more jobs are lost and every day the uncertainty continues, projects are shelved and future jobs are lost,” Mr Shorten said. “Tony Abbott must end the uncertainly and accept the renewable energy industry’s compromise position today.”

With the ground now softened the government has dug its heals in at 32,000 GWh. Industry Minister Ian Macfarlane has gone as far as suggesting that not only does the Clean Energy Council want the RET to be set so high that it fails (it doesn’t) but that the government’s review into the RET from last year illustrated that more 32,000 GWh could not possibly be built by 2020 (again, it doesn’t).

In an attempt to scare Labor into yet another compromise, the government have threatened to seek a deal with the cross-bench senators. Having recently parted ways with the Palmer United Party, Senator Jacqui Lambie has warned Labor that they risk becoming “irrelevant” in the debate. In order to support the government’s revised target, however, Tasmania would have to be entirely exempt from the cost of supporting the RET.

While Lambie believes the government will find the support it needs with the cross-benchers, Senator Nick Xenophon this week blasted the government for reneging on safeguards that were installed to gain his support for their Direct Action policy in June 2014.

In a lengthy piece in The Guardian, Xenophon responds to a recent Energy White Paper released by the government saying, “It goes against what they promised me in the discussions before the vote. I was assured this safeguards mechanism would have real teeth.”

This development underlines just how unlikely a cross-bench solution really is, with the Clean Energy Council reminding both sides that confidence will only be restored with renewable energy investors if both major political parties support a long-term, bi-partisan target.

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