CLIMATE SPECTATOR: Solar policy of ill repute
Australia's leading mining and industrial groups, as well as the most powerful industry lobbies, are prone to raising the spectre of "sovereign risk” when campaigning against imposts such as the mining tax and a carbon price. They should be thankful they are not in the renewable energy industry.
The renewables industry has experienced multiple policy convulsions over the past decade that have stalled its development, but none may be so damaging as the decision last week by the NSW government to make retrospective changes to its feed-in tariffs.
The loss of faith and reputation from the breach of contract extends far beyond the 120,000 households that are impacted by this decision. The state government may be able to protect itself from legal action, but not from the hesitancy of international investors, who – already befuddled by the confusion of policies at a federal and state level in recent years – will take particular note.
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