Antinuclear

So far, Australian government catering to big utilities, to damage rooftop solar industry

Rooftop solar PV poses a greater threat to the business models of the utilities because it gets behind the meter. This means that, unlike the boom in air conditioners in recent years, rooftop solar PV reduces demand on the network rather than adds to it.  The business models of all generators, distributors and retailers have long been based around the unwavering assumption of growing demand. They are simply not able to deal with with the absence of growth – and for this reason, rooftop solar PV is likely to have an even greater impact on their business models than more wind farms

Is Australia’s solar industry being blindsided by utilities?, REneweconomy, By Giles Parkinson  19 November 2012 Beware of people bearing gifts, the old saying goes. And beware of politicians bearing promises of a reduction in electricity bills.

The Federal Government last Friday announced the early closure of its Solar Credits scheme which offered a multiplier in the number of renewable energy certificate issued for the output of a rooftop solar PV systems.

It justified this on the basis that it would save Australian electricity consumers between $80 and $100 million in 2013. But this amounts to be just $10 a year, or 20c per household a week, in an average bill of more than $2,000. If the government were really serious about reducing the impact on electricity bills from the scheme, there were numerous other options.

It could, for instance, be pushing for a change in the rules that allow utilities to pass on a fixed $40 price for each certificate, rather than the much lower market price. (Only the ACT pricing regulator has reduced the pass-through cost, although NSW’s IPART is considering it). Such a  move would save perhaps one quarter of the estimated $1.2 billion cost of the scheme this year. Even that amounts to less than 2 per cent of electricity bills – and is forecast to decline to around 0.8 per cent in coming years.

So what is the government up to? The decision announced by Climate Change Minister Greg Combet on Friday took the solar industry by surprise. It’s not so much the financial impact of the decision that worries the industry – it will reduce the savings of a 1.5kW system by around $700, but this was going to happen in July anyway. As Nigel Morris pointed out in his blog, the biggest impact is to effectively cancel Christmas for solar installers, because they will be too busy trying to cope with the last minute rush.

What really worries the solar industry is the form guide of the decision, its timing– coming in the middle of a review of the Renewable Energy Target by the Climate Change Authority – and its arbitrary nature.

The solar industry has become used to governments lurching from one extreme to another – as has happened as a succession of Labor state governments had their overly generous solar feed in tariffs substituted abruptly by overly-miserly ones imposed by the Conservative governments.

The solar industry hopes that the federal Government can show more moderation, and more discipline. The Clean Energy Council and the Alternative Technology Association declared, perhaps optimistically, that this means that no more changes would be required. The Australian Solar Council described it at as a “disgrace”, precisely because it feared that it would not be the last. There is deep concern in all three groups about the CCA’s draft recommendation that credits for rooftop solar could be further adjusted to less than one certificate for each megawatt hour produced – effectively reducing the value of renewable energy produced at home.

The Australian solar industry should be worried because residential rooftop solar market – despite its popularity – remains the most exposed to government whim. And governments – both state and federal – are under immense pressure from utilities (some of them state owned) because of what rooftop solar does to their business models…….

Rooftop solar PV poses a greater threat to the business models of the utilities because it gets behind the meter. This means that, unlike the boom in air conditioners in recent years, rooftop solar PV reduces demand on the network rather than adds to it.  The business models of all generators, distributors and retailers have long been based around the unwavering assumption of growing demand. They are simply not able to deal with with the absence of growth – and for this reason, rooftop solar PV is likely to have an even greater impact on their business models than more wind farms…… http://reneweconomy.com.au/2012/is-australias-solar-industry-being-blindsided-by-utilities-21989

November 19, 2012 - Posted by Christina Macpherson | AUSTRALIA - NATIONAL, politics, solar