Better Feed-In Tariffs For NSW Solar Owners

NSW solar feed-in tariffs - 2022/23

There’s some good news for owners of solar power systems in New South Wales from the state’s Independent Pricing and Regulatory Tribunal (IPART).

In New South Wales feed-in tariffs don’t have to be offered by electricity retailers, but most of them do. And where they are offered, there’s no set minimum. But each year, IPART  publishes solar feed-in tariff rate recommendations for the following financial year and it’s not unusual for electricity retailers to offer more.

On Friday the agency released its 2022-23 guidance indicating solar customers can expect to receive 6.2 to 10.4 c/kWh from their electricity retailer for surplus solar electricity exported into the grid under an “all day” feed-in tariff rate. This is an increase from the 4.6 to 5.5 c/kWh guidance for 2021-22.

The reason for the increase (and greater range) won’t come as a shock to anyone:

“In 2022-23 we are expecting higher wholesale electricity prices, driven by higher coal and gas prices, and planned and unplanned plant outages.” said Tribunal member Sandra Gamble.

In addition to the “all day” rate, IPART has also made recommendations for another option electricity retailers can offer – “time-of-day” feed-in tariffs. Here’s how those benchmark ranges look in 2022-23 compared to 2021-22. IPART has also provided an indicator of the proportions of solar electricity exports for the given timeframes.

Time period 2021-22 (c/kWh) 2022-23 % of exports
6 am to 3 pm 4.3c to 5.1c 5.6c to 9.7c 90.91%
3 to 4 pm 6.6c to 8.1c 7.7c to 14.3c 6.23%
4 to 5 pm 9.6c to 12.4c 12.3c to 24.8c 2.28%
5 to 6 pm 11.5c to 14.5c 11.1c to 20.0c 0.41%
6 to 7 pm 8.5c to 9.9c 16.3c to 27.4c 0.03%
7 to 8 pm 6.3c to 7.3c 9.9c to 16.5c 0.01%
8 pm to 6 am 4.3c to 5.1c 6.3c to 10.5c 0.12%

Beyond 2022-23,  IPART expects additional solar capacity to put downward pressure on wholesale electricity prices. Solar power is already exerting downward pressure on wholesale prices, but other events are currently overriding this effect.

New South Wales is still heavily dependent on fossil fuels for electricity generation, with coal power accounting for 62.8% of electricity consumption in the state last year, and 5.7% attributed to gas (Source: OpenNEM). It’s no coincidence the two states most heavily dependent on coal power – Queensland and New South Wales – are the states to be hit hardest with looming electricity price hikes.

Solar Energy Self-Consumption Still Rules

A bump up in feed-in tariff rates will be welcomed by NSW solar owners, but the focus should still be on maximising solar energy self-consumption. With mains grid electricity usage rates generally ranging from 21c – 30c per kilowatt hour at the moment in NSW (and set to increase), a kilowatt-hour of solar electricity consumed in the home is far more valuable than a kilowatt-hour sold to an electricity retailer.

Unlocking the true savings from having solar panels installed is about load-shifting; that is, running appliances during the daytime where possible.

Just another note on feed-in tariffs: the highest rate offered doesn’t always represent the best overall deal. The best electricity plan when it comes to solar offers a balance of good feed-in-tariff rate, low usage tariffs and low daily charges. The SolarQuotes electricity retailer comparison tool is currently undergoing a revamp, but you can compare plans at EnergyMadeEasy.

If you’re still considering whether to install solar panels, check out SolarQuotes founder Finn’s guide to going solar in New South Wales, and SQ has more information on home solar power in NSW here.

About Michael Bloch

Michael caught the solar power bug after purchasing components to cobble together a small off-grid PV system in 2008. He's been reporting on Australian and international solar energy news ever since.

Comments

  1. So far here in SA most companies seem to be dropping the FITs from July 1. The average appears to be between 6-8 cents with one offering 11 cents capped at 14Kw before dropping to 6 cents.

  2. Blair Shayer says

    Can you explain to me why IPART suggestions for a timeframe based solar export pricing model include periods that are at night.

    6 to 7 pm 8.5c to 9.9c 16.3c to 27.4c 0.03%
    7 to 8 pm 6.3c to 7.3c 9.9c to 16.5c 0.01%
    8 pm to 6 am 4.3c to 5.1c 6.3c to 10.5c 0.12%

    or are they preparing for domestic wind generation systems?

    • Ronald Brakels says

      It’s for battery exports. From IPART’s media release:

      “The highest time-of-day benchmark is around 27 c/kWh during 6 to 7 pm in 2022-23, but less than 0.1% of exports occur during this time. As batteries become more widespread, customers will have more control over when they can export power to the grid.”

  3. Gaye Belbin says

    We have had a 9.9kw solar system (no battery) installed for 2 years and while we are saving some money we struggle to find ways of utilising our free energy during the day.
    We use the dish washer and washing machine during the day and run subfloor ventilation. Still the reverse cycle air for heating and cooling at night seems to draw the bulk of our power. Only limited amount of cooking can be done during the day as well.
    We haven’t installed a battery because we may not be still in the house in 10 years time, which is how long it will take to get a return on a battery.
    We are a 4 adult household.
    Any other ideas would be appreciated.
    BTW we were very happy with the help from Solar Quotes and the installer we used.

    • I feel your pain.

      I am in the same boat (7.7kw system; 2 person household). I cannot see how “load shifting” (as typically recommended) can actually make a useful difference. I’d think that most energy consumption for “normal” households will always be via heating/cooling in the morning and evening when our solar arrays are least effective. I am currently investigating battery systems (and the NSW Empowering Homes program) to see if I could/should invest even more cash (far from clear if it worth my doing BTW). So frustrating!

    • David Grieve says

      Everyones ability to load shift is different. I do all of the following

      1. Changed my hot water to come on during the middle of the day (set via a timer). My regret is not getting a wiifi timer so I can control remotely.
      2. Precool, preheat during the day/afternoon
      3. WFH
      4. Charge EV amost exclusviely from excess solar.
      5. Dishwasher(s) during the day (timer can be used for this)

      Over the year an EV and Hot water are easily the biggest loads you can shift. Sydney is fine without aircon most of the year.

      • Tom Mason says

        Agree with David, load shifting is different for everyone, but we have essentially do the same things he has listed.
        I find during winter that ‘banking’ some heating in the afternoon sun has helped. Just have to remember to turn the air-con down when the sun goes down.

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