Frustrated Tasmanians whose solar feed-in tariff was cut in half from January 1 are increasingly considering battery storage instead of feeding into the grid.
- The solar feed-in tariff for Tasmanians who invested before September 2013 has dropped to 8.5 cents per kilowatt hour
- Renewable energy advocates say there is confusion and frustration among early investors
- The Government is accused of not providing enough incentive or encouragement for Tasmanians to invest in solar
There are about 28,500 Tasmanians with solar installed at their homes.
More than half of them installed their systems prior to September 2013, when the feed-in tariff for excess electricity being fed back into the grid was about 28 cents per kilowatt hour.
They have been on a transitional feed-in rate for five years, but that’s now ended and the rate, set by the Economic Regulator, is about 8.5 cents per kilowatt hour.
The State Government is providing a five cent top-up for one year, but early investors in solar are still frustrated that their feed-in tariff rate is now less than half what they used to get.
Jack Gilding from the Tasmanian Renewable Energy Alliance said the Government was not providing enough incentive for Tasmanians to invest in solar, or enough information for those who already did.
“Confusion I think is the main result,” Mr Gilding said.
“A lack of education from the Government, a lack of explanation and complex interaction between the feed-in tariff, what you’re paying for electricity and the options that you have.”
He said the five cent top-up was only available to Tasmanians who didn’t change their existing solar set-up, meaning it was a disincentive for people to improve their solar set-ups.
“So they need to weigh up the advantages of upgrading versus losing the five cents,” Mr Gilding said.
Mr Gilding said more Tasmanians were asking questions about batteries, in light of the changed tariff.
“A lot of people have been saying well I’m not going to give my electricity away, I’m going to get some batteries and save it up for myself,” he said.
But Mr Gilding said the cost of batteries was prohibitive for many people, and the economics often only made sense for Tasmanians who needed a back-up power supply.
“It’s a disincentive for people to go solar,” he said.
Beth Muller and her husband first invested in solar for their Glenorchy home in 2011.
Ms Muller has multiple sclerosis, and her sensitivity to heat means she runs her air-conditioning all day and all night.
Ms Muller receives a medical cooling allowance but is concerned about how the change to the feed-in tariff will affect her finances.
She said she bought solar panels because she figured they would save her money on her power and medical bills.
“It has reduced our power bills to almost nothing at times, so that counteracts the $6,000 we’ve invested and really, I mean, it’s a wonderful investment.,” she said.
But she said she was concerned about the financial impact of the cut to the feed-in tariff.
“That’s coming out of our finances and in my condition it’s worrying as well, because we’re just going to have to keep (the air conditioning) on, no matter what,” she said.
“It’s a big drop in our finances and we’re going to have to totally rearrange everything that we do to accommodate that.”
Disincentive a worry, early adopter says
Jeff Jennings installed a solar electricity system and a solar hot water system at his home in Bridport in 2012.
“I thought anything that can reduce my power bill — I’m a pensioner and retired — would be a good investment,” he said.
“And they did give that incentive. They were prepared to pay solar producers the same amount for a kilowatt as they were charging people.”
Mr Jennings generates more energy than he uses, and last year made about $650. But he’s calculated that will drop by $180 under the new rate.
“It’s not so much the money that’s the worry for me, it’s that it’s a disincentive for people to go solar. And to me, that’s the future,” he said.
“We were told the 28 cents was only going to last a short time, but reducing it down to eight cents in a year’s time is going to put the brakes on people investing in solar.”
Mr Jennings said he was considering batteries more seriously since the solar feed-in tariff dropped.
Government powers towards 100 per cent renewable energy
Aurora Energy said rooftop solar generation accounted for about one percent of Tasmania’s electricity output, only making a minor contribution to Tasmania’s energy supply needs.
But Mr Gilding said solar was still saving the state power, and money.
“The more solar that’s fed into the grid, the less water we have to run out of the dams and the more water we’ve got in the dams. So that does contribute indirectly to energy security, definitely,” he said.
The state-owned electricity retailer said there was support and information available over the phone and online who needed it, and brochures had been distributed to customers explaining the change to the transitional feed-in tariff rate.
Tasmania’s Energy Minister Guy Barnett said it was up to individuals if they chose to turn to batteries instead of feeding back into the grid, and the primary benefit of solar panels was for customers who offset their own use.
“Any electricity used during daylight hours [and supplied directly from panels] saves the customer 26.431 cent for every kilowatt hour used,” Mr Barnett said.
“Customers who generate more electricity during the day than they use may consider whether battery systems are economic for them.”
The State Government has set a target for Tasmania to be 100 per cent renewable by 2022.
Greens spokeswoman Rosalie Woodruff said it was concerning that solar producers were increasingly looking to battery storage, and the Government was not offering enough incentive for people to invest in solar.
“The Liberal Government is doing whatever it can to talk as though it’s concerned about renewable energy but actually it’s not putting the incentives in that other states are doing,” she said.
“As a whole state movement, we want people to stay attached to the battery that we have of Hydro, and have a connected system.”
Mr Barnett said Tasmania was “steps away” from achieving that, with two wind farms in development.