Making Approved Solar Retailer Status Mandatory in Victoria Would Be Disastrous

Approved Solar Retailers In Victoria

In Orwell’s Animal Farm, animals were told that doing extra work was voluntary, yet those who didn’t volunteer got their rations reduced.

In November 2013 the Clean Energy Council told solar companies that becoming an Approved Solar Retailer (ASR), which requires extra work, was voluntary. But in 2018  solar companies that had not signed up started to lose their opportunity to benefit from participation in state government solar rebate and zero interest loan schemes.

Beware of schemes that claim to be voluntary but force you into applying by other means.

It seems to me that the Clean Energy Council’s Approved Solar Retailer Scheme is well on its way to becoming de-facto mandatory.  And murmurings from Victoria suggest that soon only ASRs may be able to install systems under the Victorian Solar Homes Package scheme. If that happens, then any Victorian business that does not sign up for Clean Energy Council Approved Solar Retailer status will be soon pushed out of the market.

It’s the oldest trick in the bureaucrat’s handbook. Start your scheme as voluntary (because no-one would accept a compulsory scheme) – then slowly change the rules until it becomes de-facto mandatory.

What is the Clean Energy Council Approved Solar Retailer Scheme?

Solar installation businesses that are willing to go through a rigorous application and vetting process, stick like glue to a strict code of conduct and pay the required fees can get a badge that declares them a Clean Energy Council Approved Solar Retailer (ASR).

CEC Approved Solar Retailer badge

A company can apply to be an Approved Solar Retailer. It is not mandatory yet – unless you want to sell batteries in SA, or offer zero interest loans, or cheap solar to landlords in QLD…

The code of conduct covers the retailing part of a solar business – how you advertise, quote, make the sale to customers and support them afterwards. It does not cover the quality of installation. That’s covered by the accredited installer scheme, which accredits individual installers based on their technical knowledge, competence and qualifications.

Ronald explained the scheme here in detail a year or so ago.

I used to be a fan

Up until recently I was a raving fan of the ASR scheme. If companies were willing to pay the money, do the lengthy application, add processes etc, then they could have a badge that gave them a competitive advantage.

Hell, if a company wants to go the extra mile – then let them be rewarded with a badge that acknowledges that.

My opinion began to change last year.

I started to get nervous when the QLD state government announced solar companies would have to join the ASR scheme to install systems under the government’s interest free loans and solar-for-renters rebate program.

But I didn’t worry too much as the interest free loans weren’t a game changer – and generous landlords are rare as hens’ teeth – meaning the take-up of the loans would be low and the rental scheme was unlikely to take off. The companies that chose not to be ASRs were not being locked out of too much.

But the CEC’s real vision for the ‘voluntary’ Approved Retailer Scheme became clear in SA in October 2018.  The South Australian government, after reported strong lobbying from the CEC, decided that the $6,000 battery rebate could only be offered by companies that signed up to be CEC Approved Solar Retailers.

Many SA installers went batshit. Overnight they were locked out of offering a $6,000 discount on batteries in SA. The government backtracked a little and allowed companies to join if they promised to apply to become a CEC Approved Retailer.

So lots of SA solar companies started to apply.

ASR applications went through the roof. The CEC was under immense pressure to approve more Approved Retailers than ever. In the rush I fear that their previously very tight vetting process suffered.

There are now around 250 Approved Solar Retailers. Unfortunately, among those are a handful that I would not recommend to anyone. I’ve had a gutful of legal threats recently so I’m not going to name names, but put it this way: there is one well known solar company that many industry insiders consider the antithesis of how to sell solar power. This company can now quote customers who have gone through an Approved Solar Retailer, because the CEC approved one of its sister companies as a member. This ASR can simply pass quote requests onto its sibling. How the hell the CEC let this company in is beyond me. That’s the worst example, but there are plenty of issues with other recently anointed ASR badge holders.

In my bookstore book, The Good Solar Guide, I wrote this (9 months ago):

The Clean Energy Council’s Approved Solar Retailer Scheme is different from its Accredited Installer scheme. In my opinion, the Approved Solar Retailer scheme is excellent and takes most of the risk out of buying solar. You’re highly unlikely to go with a bad ’un if you choose a company on the approved retailer list, and you’ll almost certainly end up with a well-installed, quality system.

Sadly I don’t feel this way any more. I can’t in good conscience advise someone that using an ASR is a 100% safe way to buy solar. When I update the GSG later this year, I will be changing these words to be much more cautious. From what I’m seeing, it is no longer the case that if you get a quote from an ASR you are protected from bad companies. I wish it wasn’t so. But in their rush to sign companies up, so they can offer the SA Battery Rebate, it seems to me the CEC have lost the very essence of what made the scheme special: exclusivity and safety.

“Bureaucracy is ever desirous of spreading its influence and its power.”
– Herbert Hoover

The CEC ASR scheme is approved by the ACCC.

ACCC stands for Australian Competition and Consumer Commission. They are meant to protect competition and the consumer.  Unfortunately a defacto mandatory ASR scheme harms both competition and the consumer.

If the ASR scheme was genuinely voluntary as the CEC promised it would be, it would not harm competition and it would help protect consumers. But it seems it is becoming less voluntary all the time.

Last week a little bird told me that Solar Victoria, the state government agency that administers the $2,225 Victorian solar rebate, was considering making Approved Solar Retailer Status mandatory. If this occurs and you want the $2,225 rebate deducted from your solar power system in Victoria you’ll have to use a Clean Energy Council Approved Solar Retailer.

If this happens it will be effectively impossible to compete in VIC without ASR status. No consumer is going to choose a company that can’t offer an extra $2,225 of free government money!

That’s how ASR will become mandatory in VIC. If it eventuates, the rest of the country is likely to go the same way as other states (or a Labor federal government) introduce more voter-friendly solar rebates, all potentially only available to ASRs.

It’s bad for installers who don’t want to be ASRs.

If this comes to pass, excellent companies that have done nothing wrong will be forced to either join the ASR or stop selling solar power systems. That’s not good. How can the CEC think this is OK?

All I can think is that they believe anyone who chooses not to join their scheme must be guilty of being a shonk – otherwise they’d have nothing to fear. The classic nothing to hide argument.

Hey CEC, there are hundreds of solar companies out there who are happily delivering great customer service and installations, abiding by Australian Consumer Law when they sell and support solar and installing to the Australian Standards. They don’t want another layer of bureaucracy to deal with. They don’t want every quote they send to a potential customer to be gone through by a competitor looking for a ‘paperwork’ error that puts them in breach of your rules. And they really don’t want to show you their finances. They like privacy.

Don’t lose your empathy for hard working solar businesses who just want to get on with the job.

The effect of power and publicity on all men is the aggravation of self, a sort of tumor that ends by killing the victim’s sympathies.
– Henry Adams

I support those businesses’ right to operate without extra burden. I trust them to do the right thing. And that’s based on 10 years of experience working closely with them. The bad guys can be dealt with using the fantastically consumer-focused Australian Consumer Law. No need to reinvent the wheel.

It’s bad for installers who are Approved Solar Retailers. Yes really.

Huh? How can that be? Surely existing Approved Solar Retailers have everything to gain from this?

Please don’t be naive dear solar company – as ASR becomes de-facto mandatory – the CEC becomes your judge, jury and executioner. They will dictate how you can market and sell your solar power systems. And they will decide your fate if a complaint is made (which is highly likely to be from a competitor who knows how much losing ASR status will, now, hurt your business).

My business mentor told me many years ago:

“One is the worst number in business”

Don’t become dependent on one customer, one marketing channel, one product, one vendor or one ‘Approved Retailer’ badge. Because if you lose that one thing – your business will suffer greatly. If I was an Approved Solar Retailer, I’d be worried about the power I’ve handed to one body.

So the creeping compulsion to be an ASR is bad for solar installers who don’t want to be ASRs.  It is bad for those that are ASRs but don’t realise how dangerous their dependency has become as the scheme slides towards being mandatory.

 “Some third person decides your fate: this is the whole essence of bureaucracy.”
Kollontai Alexandra, La Oposición Obrera

It’s bad for consumers because…

#1 It is no longer an effective shark net.

I genuinely believe that – due to the pressure that comes with having to sign SA installers up quickly so they can access the SA battery rebate – the ASR scheme has gone from being an effective shark net to one with shark-sized holes. I gave one example earlier.

“bureaucracies are about rules, not results.”
-Peter Drucker

If a bad company follows all the rules when applying they may get admittance to the scheme despite their reputation in the industry.

#2 Price rises are inevitable

But the real kicker for consumers is the irony of an ACCC-approved scheme that will inevitably push prices up for consumers if it becomes mandatory in Victoria.

The demand for solar power in Victoria since the Victorian rebate was launched has been off the charts. My business, SolarQuotes, has been struggling to match enough good solar businesses with all the enquiries. We’ve literally had to stop most advertising via some platforms in Victoria to reduce demand for our services.

So Victoria has very high demand for solar power.

If Solar Victoria only allow Approved Solar Retailers to be eligible for the VIC rebate, the supply of quotes will instantly plummet.

I’m no economist, but I’m pretty sure that when demand is high and you reduce supply – prices go up.

Wouldn’t it be ironic if the prices went up by $2,250 – just enough to wipe out any benefit from the VIC rebate.

Dear Solar Victoria, Please Don’t Make ASR Mandatory.

I’ve spoken to some great people at Solar Victoria. I can tell they are passionate about getting lots of high quality solar on rooftops and protecting the consumer. I can understand how insisting on Approved Solar Retailer status seems like an easy route to de-risking the solar buying process.

But I urge Solar Victoria to not make the mistake of making ASR mandatory.

In my experience, the Approved Solar Retailer scheme is not the safety net it once was and I can’t see how prices won’t rise if ASR becomes mandatory to access the rebate.

Hard working solar companies who have done nothing wrong will be forced to either acquiesce to the bureaucracy, or stop selling solar while the rebate is on offer. Talk about throwing out the baby with the bath water.

And there is no need. Everything is already in place in Victoria to weed out the bad companies. Australian Consumer Law is very consumer focused – combine that with the excellent Victorian Civil & Administrative Tribunal (VCAT) system and Solar Victoria has all the tools it needs to stamp out the bad guys. They just need to sharpen them and use them relentlessly.

Victoria also has a 100% inspection regime for solar systems. So it should be impossible for a shoddily installed solar power system to be switched on in VIC. Again this inspection regime just needs sharpening, and the penalties for unsafe installs harsher to make it even more effective.

Solar Victoria should use the tools they already have to make solar buying in Victoria as safe as it can be. Resist the urge to add rules on top of rules.

Dear ACCC, please consider withdrawing your approval of the ASR scheme if it continues to become defacto mandatory

I hope the irony of the ACCC giving their blessing to a scheme that is increasing prices and becoming less effective at protecting consumers is not lost on them. I urge the ACCC to have a chat with the CEC about the direction the Approved Solar Retailer scheme is headed.

Dear CEC, you can’t control everything

And I urge the CEC to stop lobbying state governments to force solar companies into signing up for the Approved Solar Retailer scheme. You had a great scheme that may have been growing slowly, but was effective and exclusive. Now that you’ve opened the floodgates the scheme is – from what I can see – no longer very exclusive, or even a safe-harbour for nervous solar buyers. Take the scheme back to its original promised intention – a voluntary scheme for retailers who want to join and get the kudos of a badge that is hard to earn and hard to keep.

Let solar installers who do not want another layer of bureaucracy to opt out without penalty, and let the shonky solar companies who don’t want to join because they simply want to stay shonky be answerable to Australian Consumer Law, the Australian Standards and state based consumer tribunals and consumer affairs.

After a shaky start, the CEC are doing an outstanding job of culling the approved list of solar panels and inverters. Their management of the Accredited Installer scheme has been good – they have been a big part of making the STC (aka the Federal ‘Rebate’) scheme so successful. Thank you CEC.

But the CEC cannot solve every problem in the consumer solar space. Australian Consumer Law is fantastically consumer-centric – consumers just need help knowing their rights and using them.

I urge the CEC to stop lobbying state governments to make Approved Solar Retailer defacto mandatory. You have a lot of power over the technical side of solar installation that you handle well. Resist the temptation to make your power all-encompassing.

As me old mate George once said:

“We know that no one ever seizes power with the intention of relinquishing it.”
— George Orwell

But I urge you to relinquish the power you have and want over state incentives. It hurts the ASR scheme and it hurts the consumer.

Let’s learn from the mistake in South Australia and bring the ASR scheme back to its originally intended purpose: an exclusive, hard to get, voluntary code of conduct that gives consumers who want it added protection when buying solar.

Disclosure: SolarQuotes has about 300 installers in its network who pay us every month for sales leads. Many of those are Approved Solar Retailers.

About Finn Peacock

I'm a Chartered Electrical Engineer, Solar and Energy Efficiency nut, dad, and founder of SolarQuotes.com.au. My last "real job" was working for the CSIRO in their renewable energy division.

Comments

  1. “…generous landlords are rare as hens’ teeth…”

    I resemble that remark!

  2. TJ Roberts says

    Here come the bureaucrats! It’s inevitable… I was an independent computer sales, service and design shop in the late ’80’s in Boston; after Y2K, our database business got eaten up by big giants — Oracle, Microsoft, Intuit, Cerner, etc. So, we morphed into computer repair, specifically Apples since there were no Apple Stores. We did well, and then the Apple bureaucracy started encroaching… need for VAR status, then AASP, then Certified Tch’s, then yearly renewal with exams, exam fees, $$$ By 2008/9, Apple took it all away from us; that’s what monopolies do. Stagnation results.

  3. Stefan Jarnason says

    Great article Finn, and some excellent points.

    My big issue is that under ACL and ACCC right now we continue to see too many dodgy solar retailers. We all know who they are.

    How do we squeeze them out?

  4. Whenever the Govt. mandates licenced installers, the consumer loses out. I’m currently shopping for air conditioning (split system) and a solar system so I can afford to run it. Some local solar installers have made no effort to quote, of the ones that have the cheapest deal is $2,600+ more expensive than the quote I have from SchonkySolar.com for equivalent well known tier 1 equipment. With the Aircon system I can have a top-brand unit I want delivered to my door for + – $2000 but I can’t find an installer in my area who will install a unit that they or an affiliated retailer has sold to me, my best quote to supply and install an equivalent unit is $3000, of course there is no breakdown of materials and labor, just a take it or leave it figure.

  5. Steven Zilm says

    Finn, I firmly believe the ASR has been a direct restraint on my ability to trade freely in the solar and storage industry here in South Australia. In fact I also believe that their greenwash scheme or the cash for a logo scheme should force the Commonwealth Government to remove the CEC’s monopoly position as the solar installer accreditation authority. If ARTICK, the monopoly accreditation authority for the refrigeration and air conditioning industry pulled a similar “approved air conditioning retailer” and charged fees for a logo and on sales volumes…. you’d see Gerry Harvey and the rest of the Airconditioning industry complaining loudly against it.
    And Finn what happens when (or if) the COAG Behind the Meter working group get a national Code of Conduct up?… Are the CEC setting themselves up to be the new codes monopoly administrator?
    Also I find it perplexing that the CEC’s CEO Kane Thornton admits the scheme lost money for 3 or 4 years, financially supported by the 4000 odd individual solar installers and designers. And now lots of these small enterprises are having their businesses restrained by policy created by a body they financially supported.

  6. VCAT = Victorian Civil and Administrative Tribunal

  7. Stop bitching and Comply.
    Compliance is better for consumers and customers.
    Sorry if it is inconvenient for you

  8. Well argued article – thank you for staying abreast of this insidious new government bureaucratic control mechanism. Approved Solar Retailer badge will have lost its benefit to customers and the companies that put themselves through the accreditation process. The only winners the people running ASR collecting fees.

  9. Evan Jones says

    Perhaps this is what happens after the disasters that occurred under the pink batts scheme. Governments and bureaucracies gets spooked and over regulate.
    They should be considering the effect such stimulus will have to a well (self) regulated, stable industry and the potential for new and dodgy operators (disruptors) to appear and reap some easy bucks, to the detriment of existing operators. On the other hand over regulation of these small businesses will just add to the immense regulatory and financial burdens they endure.

  10. Belinda Probert says

    The Victorian govt has from the outset said that to get the rebate you must use a CEC accredited installer. I think this is reasonable given the pink bats experience and enormous growth in the industry.

  11. Charlotte says

    Does that mean the system I purchased through the Captain cannot be installed? Because of the Vic reb

  12. Kane Thornton says

    I’m a fan of Finn’s work and opinions, but this one misses a body of facts and evidence.

    While we don’t suggest the Approved Solar Retailer (ASR) solves every problem or is perfect, relying solely on the pre-existing regulatory framework to improve the challenges in the solar retail sector is somewhere between naive and delusional. While I appreciate there are plenty of decent companies not approved under the ASR, you can’t seriously suggest or expect an average customer to be able to determine if a company’s contracts meet ACL or best practice, their directors are legit, their marketing is ethical, etc. Indeed, surely this is why governments are increasingly mandating the ASR.

    While Finn incorrectly suggests CEC has been “hard lobbying” for the ASR to be mandated, it shouldn’t be a surprise more government’s want to ensure customers have a better experience from solar retailers that meet a higher standard. That’s their decision, not ours.

    Its just plain wrong to state that the “very tight vetting process suffered” in response to growing demand. The process has actually gotten tougher and tighter as we continue to refine the scheme, noting we don’t assess companies based on “reputation” but on evidence and due diligence. This is evident by the fact that the rate of rejections has continued to hover around the 35-40% mark. And processing time increases when new applicants increases (because we won’t be rushed!).

    Of course as the number of companies approved under the ASR increase, so to will the number of breaches. Just because people are issued with a drivers license once they complete training and a test, doesn’t mean they won’t ever break the law speeding or lose their license for a serious breach. The article fails to note we have just tightened the compliance process with greater clarity and transparency in response to breaches of the code. The results of this are already obvious.

    Finally, the suggestion that the action we take in response to a breach of the code by an ASR should be proportionate to the volume of their sales is frankly absurd. Sticking with the theme, a truck driver doesn’t lose fewer demerit points for speeding because they drive more kms a year.
    Always welcome feedback on how to improve the industry, but they need to be grounded in facts.

  13. I do like the Orwell allegory! In South Australia, in 1997, the Liberal Government of the day setup a centralised computer purchase scheme for schools through a panel of approved suppliers. Schools could still purchase from any computer supplier, however if they purchased from the approved panel suppliers they would receive a rebate of $700 per computer purchased. Not hard to work out what happened next….

  14. Others have made better worded comments from the consumer perspective, but I will add mine in the hope that the installers amongst you realise that the shonks in any industry will ultimately destroy it.

    As always, “follow the money” and in this case Finn’s disclosure at the end makes it clear that he’s simply protecting his business model. One which I’m grateful for and which has provided many people with fantastic education and information.

    But I can’t help but note that the ACCC does bugger all for an individual who is out-of-pocket due to the actions of a solar reseller/installer who ignores their responsibilities.

    Mandatory regulation is the answer.
    How that’s achieved, I don’t care, but I do care that many consumers suffer losses that are covered by Australian legislation and there is no way to achieve redress at federal level and only ONE way (other that a laughably expensive private court action) in NSW, a small claim through the NCAT.
    So how about a blog post that discusses protection from shonky solar companies?
    Ah, you don’t want to upset your business model?

  15. Jack Watson says

    Now THERE’S a surprise! (taxing sunlight will be next).
    Mary Poppins wouldn’t’ve been caught with her pants down on this one.

    Solution: Sue for the same access to the taxpayers’ dollar as the favoured crowd, and set up a co-operative in direct competition to the currently-ensconced crowd. There are NO grounds for enforcing a monopoly.

    We did something similar 35 years ago in Northern NSW and had Jimmy Byrnes driving his truck back and forth from Sydney loaded with solar panels and accessories for about 2-thirds of the ‘standard’ price. (which back then was horrendous: up to $13 or $14 PER WATT was not unusual.)

    And Peter: “mandatory regulation” only adds another layer to the shit-heap we have now ~ and the mandatory rules can be changed at the stroke of any political pen in an instant.

    Take it to the lawyers, claiming restraint of trade etc etc etc. misapproprition of taxpayers’ money whatever. Set up a Co-op. and fight the bastards on the basis of issues they’d never expect and have no defences against.

    Either that, or bend over and stop complaining the lack of lubricant!

    Oh…. and Finn: I see you’ve failed to publish yet another post that doesn’t suit your purposes ~ whatever they are. I STILL say the best way of checking whether you solar system is up to scratch is whether the icecream in the fridge melts. Too complicated for you?

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