A new report suggests it may not be wise to invest in a new green project just yet.
The Government’s latest Green Investment Plan (GIP) proposes a range of tax breaks and incentives for green-energy projects that are expected to bring in up to $10bn to $15bn over the next five years.
While it’s been widely reported that the Government has put a lot of money into green energy over the past decade, the report notes that it has not done a very good job of investing in green infrastructure.
The report is part of a broader analysis of how the country’s green investment system is working, and has been compiled by the Green Investment Centre.
In the report, it’s noted that only 7.4 per cent of the investments announced in the GIP will be realised in the next 10 years, and that the Green Growth Fund (GGF) will need $2.8bn in additional funding to make it sustainable.
The GGF was set up in 2011 to address the growing pressure on the budget for green infrastructure projects.
But the GFP has been criticised by the Greens for the low amount of funding the organisation has received from the Government.
The Green Investment Report says that the GGF is a ‘slightly more conservative’ alternative to the GGP, which would see a capital infusion of up to a further $8.8 billion over five years if the Government wanted to be sustainable in the long term.
The Greens are also calling on the Government to increase the amount of infrastructure investment it makes to more than $10 billion per year.
“It’s clear that the green investment policy is a long-term failure that needs to be fixed,” Greens senator Sarah Hanson-Young said.
The Minister for the Environment, Resources and Water, Greg Hunt, has said the Government will introduce legislation to make green investment more sustainable, including an increase in the capital infusion threshold.
But it’s not just the Greens who are concerned.
The Australian Conservation Foundation says the Government should not be investing in any green infrastructure at all, and the report shows the Government is failing to deliver.
“The Government has failed to fund any green energy projects in a timely fashion, and it’s clear this has put off green energy investment from both private and public sectors,” the report states.
“If we want to see more green energy investments in the future, it is critical that the Greens continue to pressure the Government on green infrastructure.”
The Government says it will introduce an additional $20bn in capital for green projects over the following five years, which will include $2bn for projects that generate 20 per cent or more of their electricity from renewable sources.
“We know that green energy is the fastest-growing source of green jobs in Australia, and we know that we need to build the capacity to build more green infrastructure, particularly to support this emerging generation,” Mr Hunt said.
“To be successful in building a sustainable economy, we must build and support the infrastructure that supports it.”