A new survey suggests outdated energy market rules could be holding back the transition to renewables. 

The Clean Energy Investment Confidence Survey commissioned by the Clean Energy Investor Group (CEIG) has found Australia is falling behind the rest of the world when it comes to clean energy investments. 

The CEIG represents 18 major investors and project developers in clean energy projects, collectively managing over 11GW of generation capacity and $24 billion worth of investment.

While Australia has an enormous opportunity for new investments in wind, solar and storage, many investors said the nation’s energy rules are not allowing enough investment to replace ageing coal generators.

The investor confidence survey comes after AEMO released its draft 2022 Integrated System Plan, which includes a ‘step-change’ scenario in which Australia moves towards a grid dominated by renewable energy supply within the next decade.

The ‘step-change’ scenario is now expected to play out, with the rate of new investment in renewable energy and storage projects exceeding expectations.

However, investors say energy market regulators must remove the perceived shackles on increased clean energy investment, 

“The Q2 FY 2021-22 Clean Energy Investment Confidence Survey shows that investors remain concerned that the pace of regulatory and policy reform is not facilitating the level of investment needed to realise the Step Change scenario,” CEIG CEO Simon Corbell said.

“CEIG finds that investor confidence is unchanged this quarter. Investors report that the risk premium on the cost of equity is unchanged or worse.

“While investors welcomed the stronger Step Change ISP scenario, they report that the overall direction of reform in the NEM is unchanged and remain concerned about slow market reform.

“The bottom line is investment in renewable energy projects in Australia continues to fall behind. This will make it harder for Australia to realise the Step Change scenario in the time required.

“Unless we accelerate development of clean energy generation and the necessary transmission infrastructure, the continued early closure of coal could result in a disorderly and expensive transition,” he said.