Short Answer: Probably Not.
Longer Answer:
Ah, the joys of STC prices!
Every so often I get an email from someone who is desperately worried that their solar installer is using the STC price to rip them off.
The suspicion is usually kicked off by one of two things: [Read more...]
I got this email today:
“Hi Finn,
I’ve got a quote for a 1.5kW solar system for $2500 and a 3kW system for $6000. I want 3kW. Why don’t I just buy 2 x 1.5kW systems???
Cheers, Bob”
Bloody good question Sir!
In fact I can’t believe more people don’t ask this question. But, as always, if something seems too good to be true…
Despite running a popular Solar Power website, whose revenue is seriously helped by generous Federal and State solar subsidies, it may surprise you to learn that I’m not a huge fan of government subsidy in any shape or form. Mainly because I have worked for the government and seen how inefficient they really are. Trust me it is frightening.
I would be happy for the Feds to completely scrap their solar subsidy, called Solar Credits, and let the economics of small scale solar stand on its own merit through innovative finance schemes designed by innovative Solar Installers.
Here’s an example of how unsubsidised solar could work – from the Australian Financial Review no less:
(Yes – it is a bit naive in its simplicity and currently battery backup systems are more expensive – but you get the idea…)
However, if the Feds are gonna scrap solar subsidies then it comes with one condition: scrap all the Federal subsidies for fossil fuels. Fair dinkum?
Here’s an illustration of total renewable subsidies vs. total fossil fuel subsidies courtesy of the ACF:
The black box is the size of fossil subsidies compared to the green renewable subsidies.
So come on Julia, scrap the solar subsidies, along with all the fossil fuel subsides.
I’ll bet that the Solar Entrepreneurs and private companies will out innovate those, complacent, stuck-in-the past, besuited fossil fuel execs every time.
Bring It On!
And for God’s sake let’s place the solar subsidies in the context of all the other subsidies that this bloated government dishes out.
Feed In Tariffs
And what about Feed In Tariffs paid for by the state governments?
Here’s what should happen in my humble opinion.
Force the Energy Retailers to pay the “wholesale price” to customers that export their solar electricity to the grid. This is only what they would otherwise pay the coal generators for the same kWh. That will provide about 7 cents per kWh.
Force the electricity distributors to pay another 7c to thank the solar household for reducing the amount of infrastructure they need to build to get power from their power stations to the cities. (Because the solar energy is generated close to the point of use – it helps to take the strain off the system on the hottest days – and these distribution costs are about 7 cents per kWh).
Finally – and this is not gonna be popular – put a levy on the purchase price any Air Conditioner that is less than 5 star efficient to cover the other 7c. Did you know that what ever amount you pay for that air conditioner, the (massively subsidised) generators have to invest that much again in generating capacity to meet the demand for the energy guzzler?
(And don’t get me started on the fact that anyone who air conditions their home before putting simple eaves on their N, W and E facing windows is being economically insane anyway)
Add all that up and you can easily afford to pay 21c per kWh as a NET, national feed in tariff. And if you are smart about your energy consumption, you can buy a solar system with the right finance package and most likely be cash flow positive almost immediately.
Too Easy?
The issue of solar energy, and more importantly the backflip on the Solar Bonus Scheme continues to dominate debate in the NSW Parliament “bearpit”. Heroic efforts by the Coalition to contain fallout are matched only by attempts by certain Liberals to accept credit for the turnaround.
Meanwhile injecting a new angle into the sorry NSW solar debate, NSW Greens MP Dr John Kaye has led his party’s endorsement of the Independent Pricing and Regulatory Tribunal’s (IPART) recommendation that NSW electricity retailers pay the full cost of the solar power they receive. [Read more...]
By Rich Bowden
A recent report by the University of Melbourne’s EnergyResearchInstitute has found that, not only is solar energy a viable form of energy, but that costs will compare favourably with traditional fossil fuel technology in the very near future.
The report, the Renewable Energy Technology Cost Review May 2011, was commissioned by government climate advisor Ross Garnaut and included the current and expected future costs of three forms of renewable energy; wind, solar and thermal. [Read more...]
The ACT government made a welcome announcement about their, already generous, Feed In Tariff, last week.
The main points were:
The FIT now applies to “community owned” solar systems. That means that if your roof is shaded and you want to club together with others in the same position and install a system on the local RSL (for example) there is nothing to stop you getting the FIT and sharing the rewards.
Or if you live in units, you can get a shared system on the roof of the unit block.
The Feed In Tariff will be applicable for systems up to a whopping 30kW, so it becomes quite an interesting investment proposition in today’s volatile market. ( This solar calculator will crunch the numbers if you’re interested).
They also announced FITs for large scale solar. here are the details:
Some of the funding has come from the axing of plans to fund a $30 “Solar Facility” in ACT (whatever that was meant to be – probably was gonna be a bunch of public servants running around and racking up platinum frquent flyer accounts writing reports and attending conferences on how to reduce CO2 emissions – if my experience at CSIRO was anything to go by…)
In summary – great news from the land of the public servants – now we just need Julia Gillard to make all their legislation redundant by announcing a national FIT … we can but hope.
As the fireworks erupted from Sydney Harbour Bridge at 12:01am January 1 2010, the NSW Solar Bonus Scheme opened for business. It means that NSW solar panel owners will be able to collect 60c for every kWh produced for at least the next 7 years.
It will be available to panel buyers until all the installed generators under this Scheme reach 50 MegaWatts.
Panel owners who are eligible are the small electricity consumers. They are those consuming up to 160 megawatt hours of electricity annually.
Generally, this includes typical households,schools, small businesses and most community organizations.
Under this scheme, people will be able to get Solar PV Systems and Wind Turbines up to 10 kiloWatts in size.
According to Energy Minister John Robertson, the industry is expecting to install around 33,000 new solar systems during the life of the program.
The government is banking on solar PV costs decreasing over the next few years. Many are expecting that within the next 3 to 7 years, solar energy’s unsubsidized cost to consumers will be near that of dirty fossil based generation.
But in the mean time, the NSW Gross Feed In Tariff is giving a head start to the NSW solar industry so they can tool up, scale up and bring costs down and ROI up for Solar PV buyers.
Let’s hope the Feds watch and learn!
The Queensland Solar Hot Water program is delivering and installing $500 systems for eligible Queenslanders and $100 for pensioners. But as you might expect, there is the mother of all waiting lists.
To date more than 850 customers have been allocated to suppliers to conduct inspections and install new systems.
By the end of this week over 110 systems will have been installed in Brisbane and a further 200 have been contacted to arrange site inspections.
More than 43,000 Queenslanders have registered their interest to participate in this program with more than 10,000 completed applications received so far.”
The Queensland Solar Hot Water Program wants to make it easier and more affordable for Queenslanders to switch to solar energy to heat their water.
Under the Program, eligible people will have access to a standard installed and warranted solar water heater. The price given will be less than what is currently available in the market.
The Queensland Government has made a Standing Offer Arrangement with a number of companies. The arrangement is to supply people with high quality solar water heaters. The cost for them is a payment of $500 or $100 if they are pensioners or low-income earners.
The only payments people will have to pay are expenses for non-standard installations (e.g. Council fees, pipes, cables, additional electrical equipment or plumbing, or electrical switchboard upgrades.).
This Program will help the replacement of energy greedy electric storage how water systems for greenhouse friendly solar water heaters.
Installing a solar water heater will give your house energy savings of up to 25 per cent. It will also cut household greenhouse gas emissions by up to 30 per cent.
This Program will also help transition the community towards the 2010 Electric Storage Hot Water System Phase Out.
Learn all about solar hot water systems without the sales pitch at our brand new site: www.SolarHotWaterQuotes.com.au
Yesterday the NSW Government surprised renewable energy fans by switching the new feed in tariff from a net to a gross tariff.
This means that owners of solar systems in NSW will now get 60c per kwh for all the electricity they generate.
Previously you were only going to get paid for the power exported to the grid (i.e not the power you used in your house)
This makes a huge difference to the economics of buying a solar power system in NSW.
Plugging the numbers into my solar calculator shows that a good quality 1.5kW system will pay for itself in just over 4 years.
In fact you’ll be getting around $120 per month of income from the outset. And the benefits will only go up as electricity prices rise.
Even if you take out a $7000 loan at 7% interest the system would be cash flow positive from the outset. See for yourself here.
That’s a better return, and much lower risk than most other investments these days.
Have a play with our solar calculators to see if it makes financial sense for you. Just put ‘Feed In Tariff %’ as 100% and ‘Feed In Tariff Price’ as 60c and the calculator will work out the payback and monthly savings.
Since 2000, the the Solar Homes and Communities Plan started out as the Photovoltaic Rebate Program offering $4,000. The program was changed in 2007 and was receiving by then an average 153 applications per week.
As part of the Rudd Government’s election commitments, the program was allocated $150 million to provide increased rebates of up to $8,000 to 15,000 homes over five years.
The number of applications for the rebate grew from 420 per week in May 2008 to approximately 6,043 per week in May 2009. [Read more...]
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