Three steps forward, two steps back, again

The Clean Energy Council, a lobby for the clean energy industry, is talking up a record quarter for utility wind, solar and battery projects getting commissioned to full output.

But is this really a breakthrough?

The clean energy transition has stumbled over an obstacle course: community hostility to wind, solar and transmission projects, planning approvals so slow they resemble a game of snakes and ladders in quicksand, and grid connections that would test the patience of a stoic. It's now well adrift of the Albanese government’s 2030 target.

There are positive signs in the CEC’s quarterly investment report. The Australian Energy Market Operator’s efforts to get a handle on grid connections seem to be paying off, and records were broken for generation and storage connections.

Storage capacity reaching financial close set new records for the quarter and calendar year, and aggregate financial commitments for wind and solar generation were the second highest for a single quarter at $3.5 billion.

Less encouragingly, total investment in generation was just $4.4 billion for calendar 2025, down from $9 billion in 2024 — the second lowest since the CEC began keeping records in 2017. Generation capacity reaching financial close was also the second lowest.

An election in which the direction of the energy transition was up for grabs was a partial excuse, but the best we can say is it was a better finish to a bad year.

The good...

The nine wind and solar generation projects commissioned in the December quarter totalled 2.1 gigawatts of new capacity, a record for a quarter and more than the new capacity commissioned in the previous six quarters combined. The 3.3GW of new generation commissioned during calendar 2025 was the second highest annual total.

The four storage projects commissioned in the quarter brought 1.1GW and 2.3 gigawatt hours of new battery capacity to the grid, records on both counts.

Overall in calendar 2025, 11 storage projects with 1.9GW/4.9GWh of capacity achieved final commissioning. The 4.9GWh of energy storage exceeded that commissioned in the previous eight years combined.

The largest contribution to these records came from the 600MW/1600MWh Melbourne Renewable Energy Hub, jointly owned by Equis and the State Electricity Commission of Victoria.

The strength of the storage pipeline was also on show, with 1.1GW/2.8GWh reaching financial close during the quarter and a total of 4.2GW/13.4GWh achieving financial close for calendar 2025.

And not so good...

Utility wind and solar generation project commitments may be slowly coming out of their long slump — as shown by the December quarter recovery — but they’ve still got a long way to go.

The quarter was saved by a flurry of four wind farm financial closes late in December, totalling 857MW. The largest generator to achieve financial close in the quarter was the 311MW Blind Creek solar farm in NSW. The total to achieve financial close was 1.2GW.

Still, not only is investment committed for new generation down sharply on an annual basis, but the capacity brought into the construction phase by those financial commitments in calendar 2025 was the second lowest on record at just 2.3GW.

The difficulty in getting the bulging pipeline of 81 generation projects totalling 13GW through construction and into the commissioning stage is consistent with AEMO’s grid connections scorecard for the December quarter, which showed a similar uneven pattern.

While welcoming the increased momentum, the CEC said “much work remains to be done to continue to stimulate investment” — such as accelerating planning and approvals processes and ensuring critical transmission is built so that projects can be connected.

A wriggle on

Average completion times — from financial close to commissioning — of solar farms look OK across the states at around 20 months, but when it comes to getting wind farms completed, NSW (31 months) and Queensland (37 months) are real laggards.

The Albanese government’s Capacity Investment Scheme (CIS) and the NSW government’s Long Term Energy Services Agreements (LTESAs) are both designed to speed up these processes.

But as the next charts show, progress on getting CIS projects to the commissioning stage has been slow. Some speculate that — on top of all the other hurdles — the competitive bidding process produces deals that banks find hard to finance.

Whatever the cause, of the 66 CIS contracts awarded over six tenders, only two are commissioned and another 13 have reached financial close/construction stage.

The NSW LTESAs do a bit better — three out of 17 contracts are commissioned and another eight have reached financial close/construction. They may benefit from the state's renewable energy zones, but these still have to build the required transmission.

NSW and Victoria are making determined steps to speed up their planning and approvals; Queensland is at sixes and sevens over the whole transition; Victoria could be too after the November state election. Clearly they all need to redouble their efforts.