Renewable energy is on the cutting edge of a contemporary debate that intersects economic, social and environmental issues, one that encompasses wider arguments about the contribution of fossil fuels to climate change.

In Australia, at the government level this debate has focused largely on the Renewable Energy Target which mandates that 20 per cent of electricity consumption be accounted for by renewable energy in 2020. On 22 October 2014 the Federal Industry Minister, Ian Macfarlane, indicated that this target would be revised, an announcement that has been met with a mixed response.

With particular reference to New South Wales, this paper sets out the current policy framework and the facts and figures as these relate to the renewable energy industries, hydro, solar, wind and others. Prospects for investment and further development are also discussed. One finding is that:

While consumption [of renewable energy] has grown in the last few years, renewable energy still only accounts for less than 10 per cent of total energy consumption in New South Wales…There is consequently considerable scope for growth in the renewable energies sector in New South Wales.

A second finding is that:

The capacity for growth, however, is not consistent across all the forms of renewables. New South Wales, at present, has limited capacity for growth in the areas of wave, tidal and geothermal energy…Looking ahead, the capacity for renewables expansion in New South Wales therefore lies in wind and to a lesser extent solar energy.

A further reflection is that the extent of the renewable contribution to the energy mix is contingent upon investment in the renewable industries. If the proposed changes to the Renewable Energy Target are realised, the investment outlook is likely to be more subdued than currently projected.