Antinuclear

Hostility to renewable energy in Australia has been notched up a little again as the country’s major utilities prepare to brake or even halt the rapid uptake of solar PV in the country. They are currently pushing for higher network charges, refusing connections, removing discounts, forcing tariff changes on solar consumers and downsizing rooftop proposals. This activity comes even after most of the subsidies for solar have been removed and represents a tacit admission among major generators, network operators and electricity retailers that renewable energy, particular solar PV, is hurting their business model.

The latest move has come from the Australian Energy Market Commission (AEMC) which has released a “strategic priorities” document that as described the growth in solar PV as one of the most pressing issues for the electricity industry, suggesting that network tariffs do not reflect the reductions in the use of the grid caused by solar installation.

“Distributed generation is blurring the traditional delineation between consumers and producers of electricity” said AEMC chairman John Pierce in a speech to the East Coast Energy Outlook conference in Sydney. “One source of stakeholder concern is that network costs of consumers with rooftop solar PV are subsidised by other consumers because the full costs and benefits of distributed generation (such as solar PV) are not reflected in the prices consumers pay for electricity.”

The solar industry in response is feeling outraged because of the way in which the sector has been singled out when the greatest cross subsidy in the industry is given to users of air-conditioners. This is something that the Australian government itself concedes in a white paper revealing that each $1,500 air con system imposes five times that amount in network costs on other users.

“What will happen with EVs, storage, net zero energy houses (even with no PV), and any other new technologies that come along?” asked Muriel Watt, chairperson of the Australian Photovoltaic Association. “We need to develop a regulatory framework that deals fairly with all supply and demand on the grid and where those who contribute more to the costs of that grid pay more.”

What is happening in Australia is also starting to happen in other parts of the world, particularly the USA.  This is because solar PV, along with other renewable technologies, represents one of the most serious threats the conventional-power dominated utilities have ever had to face. This fact was admitted by another attendee at the conference, US energy consultant Fereidoon Sioshansi from Merlo Energy, who basically admitted that US electricity industry has already recognised that it may be too late to save their business. American consumers are increasingly finding that it is cheaper to supply their own energy rather than rely on the grid. Sioshansi used the example of mobile phone communications all around the world as an example, given that many mobile users no longer use landlines.

Australian utilities are therefore deciding to fight back, rather than adapting their business model to the new renewable economy. They hope to rely on regulatory protection in order to knock back the take-up in solar PV installation. Local distributor Powercorp for example has either rejected applications by homes and businesses to install solar or have forced the applicants to downsize their array. Another application in Warrenheip, for a 30kW system, was knocked back to 15kW while an 8kW application in Invermay was refused outright.

In Western Australia the solar industry has not decided to hold a meeting with utilities in order to discuss the situation, meanwhile in New South Wales discounts that are offered to other general customers have been denied to those wanting to install solar. Elsewhere, the solar industry is now working on a study in order to show that solar PV can reduce costs in certain areas while more generally adding a minimal amount of grid costs on average consumers.

Further information:

Australian Photovoltaic Association