Australia's Prime Minister Abbott speaks during session of World Economic Forum in Davos
Australia's Prime Minister Tony Abbott speaks during a session at the annual meeting of the World Economic Forum (WEF) in Davos January 23, 2014. REUTERS/Ruben Sprich

Australia's renewable energy industry is under threat as the latest renewable energy report has recommended that Australia should cut or weaken its renewable energy target since the cost is "not justifiable." According to the panel appointment by the Australian government, the country should close the program to new players while protecting current renewable energy investment until 2030.

The recently released review has suggested that Australia scale back to 20 percent of its electricity energy. The government should consider subsidizing solar panels on rooftops and scrapping its small-scale renewable energy target.

According to the renewable energy industry, the findings of the review only represent a "worst case scenario." Industry leaders said the recommendations would cut thousands of jobs and cause the loss of more than $10 billion in clean energy investments should the Australian government follow the panel's report.

Kane Thornton, acting chief executive of the Clean Energy Council, said the proposed weakening of renewable energy targets will "shut down the future" of Australia's clean energy industry.

According to reports, Environment Minister Greg Hunt said the government was considering the findings of the report. Hunt prefers to maintain the renewable energy target but the cabinet strongly opposes it. Prime Minister Tony Abbott, during his election campaign in 2013, has vowed to maintain Australia's renewable energy target.

Hunt favours the 20 percent target which he said was a compromise to allow new investors. However, reports said Mr Abbott may be leaning towards the tougher option.

The panel's analysis found that coal-fired power stations would benefit the most if renewable energy targets are cut. The report admitted that the plan had reduced prices of electricity although the impact to power bills would only be "relatively small" in the long term.

The panel has determined the cost of emissions-intensive companies was "not justifiable." Australia is recommended to pursue lower cost alternatives to reduce its carbon emissions.

Australia Greens leader Christine Milne doubts the recommendations of the panel. She said she was no longer surprised since the review was led by a climate sceptic, Dick Warburton. Milne believes the options provided by the panel will "destroy" the renewable energy sector.

The Abbott government is yet to confirm if it will accept the recommendations of the panel.