AUSTRALIA'S wind farm developments have ground to a halt, following a 40 per cent slump in the price of the renewable energy certificates that underwrite the industry.

The flow-on effect to regional contractors and manufacturers reliant on wind farms has been devastating.

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Portland wind turbine tower manufacturer Keppel Prince Engineering has put 70 staff on forced leave and has warned of further cuts.

"If there's no resolution by the end of February, then 120 people go," Keppel Prince general manager Steve Garner said.

Wind farm developer Pacific Hydro Australia's general manager, Lane Crockett, said the company had put $2 billion of projects on hold while waiting for Federal Government intervention.

Wind farm operators say the price of renewable energy certificates has been driven down to $30 a megawatt hour by a wave of cheap government-subsidised household solar panel and hot water system RECs flooding the market.

Wind farm, solar thermal and other large-scale renewable energy developers generate renewable electricity, which electricity retailers buy in the form of RECs.

The retailers must buy the RECs to meet the government's legislated renewable energy target of 20 per cent renewable electricity by 2020.

Last year, the Government introduced a $1600 rebate on solar hot water systems and granted solar panels 5MWh of RECs when they only generated 1MWh.

At the time, Greens Senator Christine Milne warned the move would drive down prices for large-scale renewable power generators.

Senator Milne called on Climate Change Minister Penny Wong to amend the legislation and exclude the household rooftop RECs from the market, an argument large-scale generators had backed.

But Senator Wong dismissed the warning, saying household solar hot water RECs would only take up about 5 per cent of the market.

Household RECs now represent about half the market.

But the Greens have argued the renewable energy target should be raised to increase demand and household RECs be traded in a separate market.

Minister Assisting the Minister for Climate Change Greg Combet said the Government had recognised the spot market price of RECs had slumped, prompting concerns from "some in the renewable energy industry".

"(But) most renewable energy projects enter into long-term contracts for the sale of RECs and are therefore less subject to short term fluctuations in the spot market," he said.