Annual Targets 2011 - 2030

Baselines
The main objective of the LRET is to encourage additional generation of electricity from renewable energy sources and achieve reductions in greenhouse gas emissions in the electricity sector. During the accreditation process of a power station the Regulator determines the baseline which is generally the average amount of electricity generated over the 1994,1995 and 1996 years. Eligible parties can only create LGCs for electricity generated above the baseline.

 
Power stations which generated electricity for the first time after 1 January 1997 have a baseline of zero.

Classification of certificates

From 2001 to end 2010 the commodity in the market was Renewable Energy Certificates (RECs). From 1 January 2011 RECs are reclassified into two certificate types: large-scale generation certificates (LGCs) and small-scale technology certificates (STCs).

Large-scale generation certificates (LGCs)

Large-scale generation certificates (LGCs) are an electronic form of currency created on the REC Registry by renewable energy power stations. A LGC is equivalent to:

• 1 MWh of eligible renewable electricity generated above the power station baseline

Properly created LGCs are validated by ORER and are able to be transferred between eligible parties and liable parties for a negotiated price. Payment is arranged outside the REC Registry.

LGCs are surrendered:
• annually to demonstrate liability compliance against the requirements of the LRET;
• voluntarily for any reason throughout the year; or
• for non compliance (such as under the relevant enforceable undertaking sections of the of the Act) throughout the year.

Small-scale technology certificates (STCs)

Small-scale technology certificates (STCs) are created by eligible installations of solar water heaters, air source heat pump water heaters and small generation units (small-scale solar photovoltaic panels, wind and hydro electricity systems). A STC is generally equivalent to:

• 1 MWh of renewable electricity deemed to be generated by small generation units unless the Solar Credits multiplier applies; or
• 1 MWh of electricity deemed to be displaced by the installation of solar water heaters.

STCs can be:
• assigned to a registered agent (usually a retailer/installer) in exchange for a financial benefit such as a delayed cash payment or upfront discount; or
• created in the REC Registry, queued in the STC Clearing House and purchased for a fixed price of $40 (excl GST).

STCs are surrendered:
• quarterly to demonstrate liability compliance against the requirements of the SRES;
• voluntarily for any reason throughout the year; or
• for non compliance (such as under the relevant enforceable undertaking sections of the of the Act) throughout the year.