Dr A R (Lex) Fullarton PhD MCom ATTA FIPA CTA AREI AIMM P O Box 180 Carnarvon WA 6701 0409 845 318/08 9941 1726 February 9, 2016 Renewable Energy Target Review Department of the Prime Minister and Cabinet PO Box 6500 CANBERRA ACT 2600 Australia Part B of Submission to Review of Renewable Energy Target 2014 Key Modelling Assumptions I note that the first recommendation the 2013 Renewable Energy Target (RET) review was that no further reviews were to be scheduled prior to 2016. This review is contrary to that recommendation. Rather than providing ‘an appropriate balance between flexibility in the scheme and policy stability for investments’1 As to the key modelling assumptions I suggest that the RET of 20 per cent, once considered far sighted and almost unattainable, is now far short of what it can be. I further suggest that scientific data that the Earth’s atmosphere is facing a rise in carbon dioxide (and a subsequent fall in oxygen) component is irrefutable. The assumption that a RET of 20 per cent must be reviewed with an intent to INCREASE that percentage of non-polluting fuels not decrease it. Electricity demand The assumption that electricity demand is falling I believe is incorrect. I suggest it continues to rise, however quantifiable data is being masked by ‘in-house’ consumption of dispersed embedded generation systems, in particular solar photovoltaic systems (pv). Forecasting will therefore be flawed, as it is based on partial data only. Electricity generation technology costs These assumptions focus on fossil fuelled electricity generation costs. They appear not to consider that as prices rise, demand for fossil fuelled energy will fall, thus creating an oversupply of fossil fuelled energy and a subsequent reduction in price – the Cobweb Theorem of Economics. Artificial support of fossil fuelled energy systems will have a similar impact to the energy market – and it broad-ranging impacts to the economy generally as did the artificial support for renewable energy has had. I suggest the action as to the Carbon Tax should not encompass a RET review which has been in place for 14 years and is working to reduce atmospheric pollution. Ultimately the introduction of renewable energy will create a fall in energy prices as the cost of fuel will be extinguished from the cost of generation. 1 Australian Government, Australian Government response to the Climate Change Authority’s Renewable Energy Target Review: Final Report March 2013, 2.