The head of the Australian Renewable Energy Agency (ARENA) says scrapping the Renewable Energy Target (RET) will destroy the industry.

The RET was put in place by the Howard government and tweaked in 2010 to ensure that 20 per cent of Australia's power would be generated by renewable resources by 2020 — effectively giving industry support to renewables at the expense of established fossil fuel electricity generators.

There are two targets within the scheme, a large scale RET covering projects like hydro, solar and wind farms and a small-scale RET covering rooftop solar panels and solar hot water heaters.

A recent review into the RET by businessman Dick Warburton recommended closing the large scheme to new entrants and shutting it by 2030, or ditching it now, with the renewable sector limited to a 50 per cent share of new growth in electricity demand.

Some now refer to these two options as "a true 20 per cent" target.

Supporters of the renewable energy say the industry will be devastated if the Warburton review recommendations are adopted by the Federal Government.

The review found renewables put downward pressure on power prices but keeping the scheme as it is would result in a further $22 billion in cross-subsidies to the renewable sector.

"The signal that is being sent here is 'we are closed for business', we actually don't want renewable energy, we want coal-fired power stations, we want gas-fired power stations," ARENA chairman Greg Bourne told 7.30.

Mr Bourne says that is no reason to protect the established non-renewable sector.

"Let's face it, you've got a tiny company who are taking on incumbents who've been there for 30, 40, 50, 70 years, who do not want to yield ground," he said.

"The renewable energy technologies are disruptive, they're automatically disruptive to the status quo, and the gloves are put on by the incumbents to batter down anyone who is coming through."

Big subsidies are being misspent: Warburton

Mr Bourne says the Warburton review's findings were pre-ordained, and that Mr Warburton is known for his climate sceptic views. Mr Warburton rejects that claim.

"My thoughts are well-known, however, that had nothing to do with this particular review," he said.

"There's nothing in the terms of reference to do with that, there's nothing in the terms of articles we put out.

"I guess that they (the critics) would like to put people in place who are exactly the opposite."

Andrea Fontana is the Australian manager of FRV, a global operator in photovoltaic and thermosolar energy.

"What that would mean is we would have to withdraw from all of the developments and the $3 billion worth of projects that we have in our pipeline," he told 7.30.

Mr Warburton says the RET was never intended to support the industry.

"This program was not set up to set up businesses or to try and encourage renewables into the marketplace which it's done, and that's a good side of it," he told 7.30.

"But it's not necessary at the moment and the big subsidies are just being misspent when they could be put into other areas."

Coalition MPs split on the future of the RET

The Government has stressed that the review is a report to government, not of the Government.

But there is growing concern in the community and the Solar Council has launched a grassroots campaign targeting marginal coalition electorates.

"Let's see what happens in the electorates of Eden Monaro and of Petrie and of Reid and of Barton and of Dobell and Corangamite," the Solar Council’s John Grimes told a meeting of solar industry workers and supporters in Queanbeyan last night.

In the Victorian seat of Corangamite, 24 per cent of homes have solar PV systems or solar hot water.

Sarah Henderson, the local Liberal member, said she does not want the small scheme scrapped, as the report recommended, nor is she convinced the review's two options for the large RET are right.

"They are two possible mechanisms to reach a true 20 per cent which was the intention of the legislation," she said.

"But I am just saying, maybe there are other mechanisms because the feedback I am receiving, the industry is concerned about ensuring that there is the confidence to continue invest in renewables.

"We've got to make sure whatever we do, of course I am just one part of the backbench, we've got to make sure that we continue to drive strong confidence in the renewable energy sector."

Queensland LNP senator Matthew Canavan says current investors must be protected but he wants the scheme gradually phased out.

"The RET is no different to other forms of industry assistance — they shouldn't be in place forever," he told 7.30.

"Industries should either grow up, or we move on, because if we just continually provide people with assistance, they'll never have the incentive to be more efficient and grow up from being an infant."

The issue is a political hot-potato for the Government. Cabinet is wrestling with the findings and is expected to have a response by the end of the month.

7.30 has been told some within Cabinet are keen to find a middle ground, and with the small-scale target especially popular, it may need to.

Whatever happens, the Government's changes will have to pass the Senate, and if the Palmer United Party's words can be trusted, there will be no change.

"The Renewable Energy Target is working," PUP Senate leader Glenn Lazarus said.

"If the Renewable Energy Target is to be changed, this should only happen in response to the will of the people not climate change sceptics.

"I believe the Warburton review has failed to make a case to cut the Renewable Energy Target."