Feed-in tariffs in Australia: Fiscal incentives and regulatory regimes - Current developments and policies for the future

Australia's governments have and continue to implement measures to lower greenhouse gas emissions. The two principal federal policies are a Renewable Energy Target (RET) which aims to source 20% of electricity from renewable energy sources by 2020, and the Carbon Pollution Reduction Scheme (CPRS), which will centre on an emissions trading system operating from mid-2011. This paper examines the issue of whether Feed-In Tariff (FIT) schemes can make a significant contribution to the abatement of greenhouse gases in Australia. The present and planned Australian FIT schemes are designed to encourage (by resorting to a premium tariff) the installation of renewable generation technology in the premises of small power consumers such as households. This power would substitute for power that would otherwise be sourced from the grid, which power is (predominantly) sourced from non-renewable energy sources. A power surplus to the user's needs could be exported to the grid. By way of background, the broader strategies for decarbonising Australia's electricity industry, and the progress made, will be examined.