Queensland is set to become the home of Australia's largest solar farm, to be built south-west of Toowoomba.

Toowoomba Regional Council has this week approved the staged construction of a 5,000 hectare site at Bulli Creek, near Millmerran.

Developer Solar Choice plans to start construction next year.

When complete, the farm would be capable of producing 2,000 megawatts (MW), more power than any one coal-fired power station in Queensland.

The proposal would see the solar farm built in multiple 100MW-plus stages over a period of eight years.

Solar Choice managing director Angus Gemmell said the approval 'milestone' comes after 18 months of planning.

"It's almost mind-boggling large, just the width of the project is eight kilometres," he said. Listen Duration: 3 minutes 8 seconds 3 m 8 s Listen Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Solar Choice's Angus Gemmell outlines plans for Australia's largest solar farm ( Belinda Sanders ) Download 1.4 MB

"That's a lot of panels."

Mr Gemmell said the Bulli Creek site, currently cattle grazing land, was chosen for its close proximity to a major Powerlink substation which would allow the farm to connect to the national electricity grid.

"It's soaked in sunshine, there's great irradiance levels west of the Great Divide," he said.

While the project has seen strong overseas investor interest, Mr Gemmell said the current uncertainty on renewable energy policy in Australia was hindering the $1 billion development.

"Whilst we are certainly well advanced with global investors for the fully equipped solar farm, they understandably are awaiting regulatory certainty on the renewable energy target," he said.

"Hopefully we won't be the first country to diminish the target, and we're hoping the bipartisan support that renewable energy once enjoyed at the federal level will remain."

Construction on Australia's largest solar could start next year, at a site south-west of Toowoomba. ( File photo )

Future of the RET remains uncertain

The Renewable Energy Target (RET) is designed to ensure that 20 per cent of Australia's electricity comes from renewable sources by 2020.

The Abbott Government last year commissioned a review of the RET, with Dr Brian Fisher part of the four-member expert panel.

He said the 20 per cent target still existed, but the problem was demand for electricity had fallen.

Dr Fisher said the Federal Government faced a hostile senate if it wanted to change policy.

"The plan was that we would be producing 20 per cent of our electricity from renewable sources by 2020," he said.

"As it turns out the demand for electricity is likely to be mush less than originally projected, so under current legislation we will be producing around 27 per cent by 2020."

"So it has become very difficult for renewable energy projects to negotiate power purchase agreements with retailers and distributors." Listen Duration: 3 minutes 30 seconds 3 m 30 s Listen Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Renewable Energy Target Review panel member Dr Brian Fisher discusses fall off in investment in renewables. ( Robin McConchie ) Download 1.6 MB

Dr Fisher said this had resulted in a slowdown in the development of new projects.

He said one of the RET review recommendations was to realign the target, currently 20 per cent, with actual demand.

"While the [discrepancy] persists, it is going to be very difficult for any of these projects to make any progress," he said.

Dr Fisher said the problem was the demand was less than what was forecast.

"As Ford and Holden leave our shores, demand will continue to decline and in addition to that, we have seen much more uptake of solar panels by private households, which is further reducing demand from the power companies," he said.

"The question is, 'What is the Government going to do with respect to the current legislation, given the uncertainty about where the senate is going to come out on these issues?'"