New analysis from research consultancy GlobalData revealed solar PV had a cumulative installed capacity of four gigawatts, overtaking wind, which totalled 3.8GW last year.

While the carbon pricing mechanism introduced by Australia’s Labor government in 2012 to support a low-carbon economy has since been scrapped by the Coalition government, GlobalData said the mechanism had nonetheless provided incentives for the reduction of emissions with a fixed annual price for three years.

And although the mechanism was scrapped in July 2014, tax liabilities for the applicable years still have to be met in full.

GlobalData’s senior analyst covering power, Siddhartha Raina, said growth in Australia’s solar PV market has been a recent development, and is largely due to policy support from the government, which has often included financial incentives.

However, some regulations, such as National Greenhouse and Energy Reporting Regulations (2008) and the Australian National Registry of Emissions Units Regulations (2011), are currently undergoing amendments, and the Clean Energy Regulator has recently announced that it will hold the second Emissions Reduction Fund auction for carbon abatement contracts, the Coalition’s Direct Action policy.

The federal government recently announced the revised Renewable Energy Target to support emission-intensive industries and reduced the RET from 41 terawatt hours to 33 TWh.

Raina said that despite this, new renewable energy capacity of 6GW still needs to be installed by 2020.

GlobalData’s report also forecast that while solar and wind power would remain key contributors to Australia’s renewable energy mix, bioenergy is set to become increasingly important.

“While feed-in tariffs and renewable energy target schemes, along with other subsidies and support initiatives, have had a major impact on the solar PV and wind industries, the impact of such programs on biopower and small hydro has been minimal,” Raina said.

“Despite this, strong government backing is expected to promote stable growth in the bioenergy sector.

“Bioenergy capacity amounted to 573.9 megawatts in 2014 and is expected to more than treble to 1.8GW by the end of 2025.”