Australia will review its mandatory renewable energy target (RET), the government said Monday, sparking concerns among green groups that a weaker target could pave the way for new coal plants and increased pollution.
The target to ensure Australia generates 20 percent of its electricity from renewable sources in 2020 has been a boon to the nation's wind and solar producers, but has been blamed by the conservative Coalition government for increasing power prices.
"In particular, the review will consider the contribution of the RET in reducing emissions, its impact on electricity prices and energy markets, as well as its costs and benefits for the renewable energy sector, the manufacturing sector and Australian households," Industry Minister Ian Macfarlane said in a statement.
The target was introduced by the previous conservative government of John Howard to cut emissions from Australia's coal-dependant power sector.
But a weakened RET combined with the government's plan to repeal the carbon tax would shift new energy investments away from renewable sources to more coal-fired electricity, causing more pollution and making it hard to meet the climate target, according to observers.
"With no emission limit and price to make major emitters responsible for the pollution they cause, sectoral policies like the RET become much more important in meeting the government's emission reduction commitments," said John Connor, CEO at think-tank The Climate Institute.
The Institute calculated that in 2015, the RET would cost the average household around A$1 ($0.91) per week.
Macfarlane said the outcome of the review was not set, though Environment Minister Greg Hunt last month proposed to delay the implementation of the target by five years.
Australia's move comes as U.S. Secretary of State John Kerry warned Indonesians on Sunday that man-made climate change could threaten their entire way of life, deriding those who doubted the existence of "perhaps the world's most fearsome weapon of mass destruction".
Green groups in Australia saw the appointment of Dick Warburton, a former Reserve Bank board member who has expressed doubt that carbon emissions cause climate change, as a clear sign that the government's intention is to weaken or remove the target.
The review expert panel will report directly to the prime minister's office, which Connor said was "skirting legal requirements for the independent Climate Change Authority to be the body to conduct the review".
Environment Minister Hunt reiterated on Monday his ambition to repeal the carbon tax, saying it cost Australia A$7.6 billion ($6.9 billion) in 2012-13.
The RET review report will be presented to the government by mid-year.
(Reporting by Stian Reklev; Editing by Muralikumar Anantharaman)