Table Of Contents

The Mandatory RET

The Renewable Energy Target allows both large-scale power plants and small-scale system owners to create large-scale and small-scale technology certificates for every megawatt-hour of electricity they generate.

Energy retailers (those who provide electricity to homes and businesses) then purchase certificates and submit them to the Clean Energy Regulator to fulfil their legal requirements under the Renewable Energy Target. This establishes a market that rewards both big renewable energy power plants and small-scale renewable power station owners with financial incentives.

Australia produces electricity using coal and gas-fired power plants and a variety of renewable power sources such as large-scale hydro-power plants and wind farms, as well as small-scale solar water heating and solar rooftop panels, to power your home and business.

Renewable Energy Target Explained

The Renewable Energy Target is an initiative by the Australian government to reduce greenhouse gas emissions in the electrical sector and encourage the use of sustainable and renewable energy sources. The Australian Parliament enacted the Renewable Energy Amendment Bill of 2015 in June 2015.

The Big Renewable Energy Target was cut from around 41 000 GWh to about 33 000 GWh in 2020 as part of the amendment bill, with interim and post-2020 targets altered appropriately. Small-scale technology certifications are issued after a qualifying system is installed and are calculated depending on the quantity of electricity it generates or replaces.

In exchange for a lower purchase price, homeowners who buy these systems typically give the ability to establish their certificates to an agency. Depending on the amount of solar energy available, the magnitude of this benefit varies across the country.

Large and small-scale Renewable Energy Targets

The Clean Energy Regulator administers the Renewable Energy Target's two programmes:

The Large-scale Renewable Energy Target supports investment in renewable power plants to generate an additional 33 000 gigawatt-hours of renewable electricity by 2020, and Small-scale renewable energy schemes, such as domestic solar panels and even solar hot water systems, are supported by the Small-scale Renewable Energy Scheme.

The Large-scale Renewable Energy Objective aims to meet the bulk of the 2020 target. In contrast, the Small-scale Renewable Energy Scheme encourages the development of small-scale renewables like solar rooftop panels plus solar hot water systems in homes.

How the Renewable Energy Target scheme works

The Renewable Energy Target works by issuing tradable certificates that act as a financial incentive to generate more power from renewable sources. The REC (Renewable Energy Certificates) Registry, an online trading platform run by the Clean Energy Regulator, is where certificates are produced and issued.

Large renewable power plants and small-scale system owners are entitled to issue certificates for every megawatt-hour of electricity they generate under the scheme, forming the 'supply' side of a certificate market. The 'demand' side of a certificate market is formed by wholesale power purchasers, primarily electricity retailers, who purchase these certificates to fulfil their renewable energy commitments.

Wholesale power purchasers subsequently relinquish those certificates to the body of Clean Energy Regulator in annual percentages determined by legislation. The amount of electricity produced by an approved system decides the number of certificates granted to a person or firm.

Renewable energy power plants, small-scale solar cells, wind and hydro-power systems, solar water heaters, and heat pumps are all examples of eligible systems. Financial institutions, traders, agents, and installers participate in a secondary sector for certificates that the Clean Energy Regulator does not regulate.

Examples Of Renewable Energy Resources


Thermal and photovoltaic cells are the two main methods for harvesting solar energy. Thermal energy is created by heat and can be utilised to heat the water in your solar water heaters directly. This form of energy may help you save money on your water heating bills.

You may utilise thermal energy to superheat water to steam, which can then be used to power turbines to generate electricity on a bigger scale. PV cells produce electrical currents via light rather than heat, as opposed to thermal energy. The most significant disadvantage of solar energy is that it cannot function unless the sun shines.

Energy is stored in a battery or sourced from other sources on overcast days and at night. Additionally, dust on a solar panel might reduce its efficiency. As a result, it's worthwhile to get your solar panels expertly cleaned regularly. On the bright side, you might be qualified for a solar system rebate to help defray the cost of installation.

You might be able to benefit from solar feed-in tariffs as well. This is when your state compensates you for excess energy generated by your solar panels, which are then returned to the grid, as mentioned earlier.


Wind energy has been used as an energy source for a long time. Wind turbines are primarily utilised to generate electricity in the twenty-first century. The majority of wind generators are placed in clusters, where consistent winds ensure that they remain operational for most of the time.

Wind energy, like solar energy, is relatively irregular in supply. As a result, storage and renewable power choices are required to make it a more efficient green energy source.


Turbines, like windmills, are an ancient form of energy that is frequently utilised to directly power machinery. The power of moving water is used to spin turbines that generate electricity in modern hydro-power. The Snowy Mountains complex, which was established in New South Wales in the 1950s, is the most well-known hydro project in Australia.

Hydroelectricity is also widely employed in Tasmania, where water-powered generators provide the most electricity. The biggest disadvantage of hydroelectric power generation is the vast amount of water needed to maintain continuous operation.

Droughts can deplete water supplies to dangerously low levels. In some cases, energy-generating may be halted to protect the supply of drinking water and other essentials.

Benefits Of Renewable Energy

Renewable energy offers the potential to completely transform our lives. Using renewable energy, whether from solar panels or any other green energy source such as wind, hydro, or biomass, has demonstrated environmental, economic, and also human health benefits. Here are some of the advantages of renewable energy in our country and any other part of the world:

Reduces Air Pollution

When fossil fuels are utilised to generate power, nitrogen oxide is produced, a harmful greenhouse gas. It may cause smog and acid rain, but it can also produce ground-level ozone, which is a dangerous air pollutant.

The ozone layer, also known as stratospheric ozone, protects humanity from the sun's dangerous UV radiation. However, ground-level can cause several health issues, including:

  • Reduced lung function
  • Damaged lung tissue
  • Coughing
  • Throat irritation
  • Airway inflammation

Heat, sunshine, and volatile organic substances — especially artificial chemicals being used in the creation of paints, medicines, and refrigerants — combine to produce ground-level ozone. When renewable energy sources generate electricity, they do not emit nitrous oxides.

Renewable energy not only does not emit greenhouse gases but also reduces your carbon footprint and helps offset the necessities for fossil fuel power, which can contribute to excessive air pollution in urban locations.

Saves Money

Renewable energy is beneficial not just to the environment but also to our wallets. For starters, renewable energy plants require less upkeep. Second, they do not require refuelling because they use the sun, wind, steam, and biomasses.

Finally, we are not reliant on foreign sources of energy. We will be self-sufficient if we use renewable energy sources. However, we must not overlook the drawbacks of renewable energy sources.

Will Never Be Depleted

The first and most obvious advantage of adopting renewable energy is that it is renewable. It does not mean that it will run out. Ever. Although fossil fuels will be depleted in about 40-60 years, the sunshine will always be around each day, the wind always will blow, and geothermal energy will always exist.

If they do not, we will face far more serious issues than simply running out of power. And while we're on the subject of our world, we should also add the second benefit: renewable energy's environmental benefits.

Feed-In Tariffs

You might be eligible to receive payment by the state or even territory government if you have some solar panels and feed excess electricity back into the grid. If your power system meets specific conditions set forth by your power provider, you could be entitled to a solar feed-in tariff. The sum of money you might receive will be determined by where you live and your specific grid provider.

Some Cons Of Renewable Energy


What are considered advantages of renewable energy technologies from one end may be viewed as a disadvantage by another. Clean energy is primarily renewable, but it is not always available 24 hours a day, seven days a week. The wind might blow one day but not the next.

The sun might be shining now, but it might turn cloudy tomorrow. So, if someone asks you what are the drawbacks of using 100 per cent renewable energy, the availability of renewable resources is unquestionably one of them. For "rainy days," an add-on innovation is recommended.

Storage Constraints

The most significant advantage of natural gas versus renewable energy is its ease of storage and transportation. There are several renewable power storage technologies available today, and they're still in their development, which means they are either inefficient or expensive.

It is significantly more severe for large-scale plants. Although the storage-related drawbacks of alternative energy are diminishing by the day, fossil fuel storage will continue to be more efficient for a long time.

High Initial Investment

Green energy systems are substantially more expensive to install than standard fossil energy systems. Many people will be put off by these fees since it will not be lucrative in a few years, but only in decades. However, the good news for Australia is that the government typically encourages green energy and gives monetary incentives, including tax credits or financial assistance.

The Impact Of Renewable Energy Target

These programs aim to encourage the adoption of renewable energy while reducing reliance on fossil fuels. If such increases electricity use, the expense is spread among most customers through hikes in other tariffs. Save for the costs of creating and monitoring the program and any audit or enforcement proceedings, government finances do not fund this initiative.

With renewable energy now more affordable than other sources, attaining and surpassing a renewable power target will result in lower electricity bills for customers. Are you ready to go green and reduce your carbon footprints? Reach out to a professional solar installation company and begin the journey today.