Emissions plan may loll GreenPower

Sydney Morning Herald
Monday 2/3/2009 Page: 4

THE future of Australia's renewable energy program, GreenPower, is in doubt, after big energy companies warned it might not be viable under the Rudd Government's planned emissions trading scheme. The GreenPower program has been heavily promoted by state and federal governments and environment groups. Householders pay extra on their power bills, which is invested by energy companies in renewable sources like wind and hydro.

The head of the Energy Retailers Association of Australia, Cameron O'Reilly, has written to state energy ministers asking for their support to save the program, which has more than 800,000 customers nationally. A household's voluntary purchase of GreenPower would not technically be recognised under the Government's scheme as reducing national greenhouse gas emissions, according to the letter.

In the letter, obtained by the Herald, Mr O'Reilly warns ministers: "[Energy] retailers are likely to face a number of consequences if GreenPower ceases to be a viable proposition, the most obvious of these involves contacting each of the 800,000 GreenPower customers, explaining to them how the premise under which they had entered into their contract has changed and offering them the ability to transition to an alternative nonrenewable product".

The predicament has arisen because the GreenPower program, considered one of the most successful efforts by households to cut their greenhouse gas emissions, is voluntary. Under the Rudd Government's carbon pollution reduction scheme, energy companies and all big greenhouse polluters must, by law, obtain permits to emit greenhouse gases.

The Government is also introducing a renewable energy target aimed at providing 20%of the electricity supply from green sources by 2020. The scheme sets a target or limit on the greenhouse pollution for Australia of between 5% and 15% below 2000 levels. Mr O'Reilly told the Herald that energy companies were still hopeful GreenPower could be brought into the new scheme and counted towards cuts to the nation's emissions.

"There are a lot of people who have fully embraced the GreenPower policy. It is about taking additional action and it might be wise to give them that option, particularly if you look at the debate on the targets," Mr O'Reilly said. The voluntary program has no obvious way of fitting into the new system because energy retailers will not have a direct incentive to promote green power.

The Federal Government is aware of the problem and is trying to work out a way to incorporate GreenPower but has so far been unable to. Environment groups have criticised the Rudd Government's national targets as too low and there is growing criticism that household efforts to cut emissions will allow big polluting companies to make less effort to reduce their emissions. A spokeswoman for the Climate Change Minister, Penny Wong, said buying GreenPower "will continue to drive investment in renewable energy technologies, such as wind and solar".