Once coupled with a renewable energy target (RET), the soon-to-be-introduced emissions trading scheme will enable a smooth transition to the carbon economy, a report has said.

According to the report released by the Energy Supply Association of Australia, the Government-proposed 20 per cent RET by 2020 is expected to create the investment potential worth $36 billion in renewable energy to meet growing energy demands.

The Clean Energy Council’s general manager policy Rob Jackson said the transition to the carbon economy, supported by the investment potential, will generate economic benefits along with the opportunity for further emissions cut.

“The clean energy industry alone stands ready to invest a minimum of $20 billion in zero-emission, renewable power required to meet the target and to ensure a diverse and secure energy supply for Australia; creating over 6,000 new job opportunities nationwide.

“A renewable energy target will ensure that the growth in Australia’s energy demand will be met by clean sources – immediately stabilising greenhouse gas emissions in the stationery energy sector, taking pressure off the emissions trading scheme, and building critical industry capacity to deliver even greater abatement into the future.”

Mr Jackson said the RET is a practical measure to offset the limitation of the ETS. 

“Evidence suggests it will take some time for the emissions trading scheme alone to deliver a carbon price high enough to stimulate renewable energy investment,” he said.

“With a 20 per cent renewable energy target in place now, the pressure is taken off the ETS, commencing in 2010, to reach a high carbon price quickly.

“Renewable energy targets are a proven and effective policy measure to drive deployment of a new renewable energy generation and will aid the transition to an emissions trading scheme.”