Throughout 2011 we saw many changes in feed in tariffs throughout Australia. The main dilemma for governments is balancing the growth of solar (and the benefits this brings in creating sustainable energy) and the cost to the taxpayer in rewarding homeowners.
This has meant that many schemes have been either cancelled (NSW) or would down in an orderly fashion (ACT). Canberra had a known amount of solar the local government would allow to be installed on households, yet companies still blame a “sudden end”.
This type of change normally causes a huge rush in markets because those considering solar act to ‘lock in’ the existing feed in tariff while it is available (mostly feed in tariff changes continue to offer the existing tariff structure to people for the intended duration, so it is only new applicants that get the new / lower tariff).
Solar rewards under review
Tom Arup January 13, 2012
THE Baillieu government is set to order a review of incentives for rooftop solar panels, asking the state’s top competition body to make recommendations on whether to phase out or change them.
The solar review will be carried out by the Victorian Competition and Efficiency Commission (VCEC), and the government says it will help develop future ”fair and cost-effective arrangements” in light of the federal carbon price scheme.
The review of solar feed-in-tariffs – expected to be ordered today – was first promised by the Coalition during the 2010 election. But a spokeswoman for Treasurer Kim Wells said reports into manufacturing and the state reform agenda had needed to be completed first.
Last year the state government replaced the premium solar feed-in-tariff of 60¢ per kilowatt of power fed into the grid, with an interim price of 25¢.
As part of the inquiry, Mr Wells has asked the commission to ”provide a recommendation as to whether existing feed-in tariff arrangements should be continued, phased-out or amended”.
If it recommends dumping tariffs, the government has asked for advice on whether transitional measures were needed. The review’s terms of reference say any changes will not be retrospective.
Clean Energy Council policy director Russell Marsh said the solar industry needed to be given assurances the current 25¢ tariff would not end before an allocated two-year period has finished.