The nation’s leaders have ticked off on a plan to have 20 per cent of Australia’s electricity generated from renewable sources by 2020, but many businesses won’t have to pay the additional cost.

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The 20 per cent Renewable Energy Target (2020) is a key Rudd government pledge, and is separate to emissions trading.

State and territory leaders signed off on the plan at a meeting of the Council of Australian Governments (COAG) in Hobart on Thursday.

Electricity more expensive

Households and some businesses will have to pay for the renewable energy boost through higher electricity prices.

But trade-exposed industries will not have to pay, Prime Minister Kevin Rudd announced after the meeting, adding a new element to the deal.

The financial crisis and their role in emissions trading was the reason.

Some green groups say it’s not fair that households have to pay to green up energy, while heavy polluting industries won’t have to contribute.

‘Full of potential’

Mr Rudd said the renewable energy sector was full of potential. “Wind, wave, solar, geothermal – all wanting to get out there and have a go, make a difference, generate jobs, new business opportunities, and also contribute to the renewable energy target,” Mr Rudd told reporters.

“This therefore is where a whole lot of activity is going to come from.”

The government says laws to bring about the RET will be introduced in the middle of the year and the target will come into effect from next year.

Jobs boost

Tasmanian Premier David Bartlett said implementation of the RET would have a massive affect on “hundreds of millions of dollars in investment in renewable energies” which had stalled due to a lack of government incentives.

The RET would boost jobs immediately, and encourage more low-emission energy into the future, he said.

COAG also agreed to tough new standards for energy efficiency for homes and commercial buildings.

From 2010, all new homes will have to be built to 6-stars in energy efficiency.

Hot water systems and lighting will have to meet new energy efficiency requirements.

Energy disclosure for homes

From mid-2011 there will be mandatory disclosure of the energy, greenhouse and water performance of homes before they can be leased out or sold.

Energy efficiency requirements for commercial buildings will be toughened from 2010.

There will be mandatory disclosure of energy efficiency for commercial buildings from 2010.