Labor has quit its negotiations with the Abbott government about Australia's renewable energy target saying there is "no prospect of reaching an agreement".

In an escalation of the high stakes clash over Australia's energy future, the opposition's environment spokesman, Mark Butler, has written to Industry Minister Ian Macfarlane to end discussions that were aimed at restoring bipartisan support for the renewable energy policy.

Renewables: Labor has walked away from RET negotiations with the Abbott government. Credit:Graham Tidy

In a letter to Mr Macfarlane on Tuesday, Mr Butler said that the government's plan to dramatically scale back the target had not budged throughout weeks of negotiations.

He said Labor would not "stand by and watch" billions of dollars in investment in Australia's renewable energy sector head overseas because of deep cuts to the target.