Executive summary of update

This update to the Renewable Energy (Electricity) Act 2000 introduces two significant changes effective from 1 January 2026. Firstly, it prevents the "double dipping" of environmental certificates by prohibiting the creation of Renewable Energy Certificates (RECs) for electricity that has already been used to create a certificate under the new Future Made in Australia (Guarantee of Origin) Act 2024. This forces a choice between schemes for renewable energy generators. Secondly, it clarifies the treatment of electricity used for energy storage, exempting it from being a "relevant acquisition" and thus reducing the Renewable Energy Target liability for entities operating storage systems. This provides greater certainty for the business case of energy storage projects.

Impacted parties

This update primarily impacts renewable energy generators, energy storage facility operators, and liable entities such as electricity retailers.

Change Analysis

1. Prevention of Dual Certificate Creation (Double Dipping)

• What has changed: New provisions have been added to prevent the creation of both Large-scale Generation Certificates (LGCs) and Small-scale Technology Certificates (STCs) if a certificate under the Future Made in Australia (Guarantee of Origin) Act 2024 has already been created for the same electricity. Section 18(4)(d) now excludes electricity from LGC calculations if it has been used for a Guarantee of Origin (GO) certificate. Similarly, the new Section 23A(1AA) prevents the creation of STCs for a small generation unit once a GO certificate has been created for that facility.
• Why it matters: This change establishes that a single megawatt-hour of renewable electricity can only be used to create a certificate under one federal scheme, not both. Project developers and owners must now choose between creating RECs or GO certificates. This decision will impact project revenue streams and financial modelling, as the value and market for each type of certificate may differ. It prevents the potential for a single unit of renewable energy to be counted twice for different policy objectives.

2. Favourable Treatment of Energy Storage Systems

• What has changed: The Act now formally defines an energy storage system in Section 5. More importantly, Section 31(2)(d) has been added to exclude electricity acquired for the purpose of energy storage from the definition of a "relevant acquisition". This means electricity drawn from the grid to charge a battery is no longer counted towards a liable entity's renewable energy obligations. Furthermore, the new Section 33A clarifies that electricity discharged from a storage system is treated as newly generated electricity.
• Why it matters: This is a significant clarification that supports the business case for energy storage projects....