Solar Export Tariff For South Australia Soon

South Australia’s electricity distributor SA Power Networks (SAPN) has announced it will be introducing an export tariff —sometimes incorrectly referred to as a ‘sun tax’ — from July 1 this year. Here’s why, how it will work and how much it will cost.

SAPN has been grappling with managing increased solar energy goodness flooding South Australia’s grid during the day — a grid that was originally designed to deliver energy one way; from the generator to consumer. Too much of this particular good thing can threaten electricity network stability and equipment.

Among the actions SAPN has taken to date are the introduction of inverter limits, remote disconnect/reconnect and pioneering flexible solar exports. But it seems that won’t be enough.

SAPN says to ensure South Australians can keep exporting electricity from their solar panels into the future, it needs to carry out targeted network upgrades and intends investing approximately $82 million on related projects and services between this year and out to 2030. Some of the work includes upgrade of voltage control at SAPN substations and the installation of new street transformers.

“These upgrades will benefit every customer in the State over time, even those without solar — but those with solar will see greater and more immediate benefits. This investment will be enabled through an export tariff,” states SAPN. “It means that electricity network upgrades to support these energy exports are funded by those who benefit from them the most. This makes it fairer for those who do not have the ability to export energy.”

How SAPN’s Solar Export Tariff Will Work

The export tariff will be a charge applied to surplus energy exports only, and only above a ‘free’ threshold at certain times. It will:

• be introduced from 1 July 2025;
• charged to electricity retailers, who will decide if/how they pass on this charge; e.g. as a feed-in tariff reduction;
• apply to all residential and small business customers who export through solar PV, batteries and V2G connection with an inverter capacity up to 30kW AC;
• also apply to flexible export customers;
• not apply to the first 9 kilowatt-hours (kWh) exported to the grid per day between 10am – 4pm for customers with an interval (smart) meter;
• not apply to the first 11 kWh exported per day between 10am – 4pm for customers with an accumulation meter; and
• not apply to exported electricity outside of 10am – 4pm each day.

If a residential customer doesn’t use all their daily free export, it can be used on another day within the billing cycle (typically 90 days). For small business customers, there’s a rollover feature as well, but their billing cycles are usually shorter (30 to 31 days). Furthermore, unused daily free export from businesses on a ‘work day’ can only be used on another work day, while unused daily free export from a ‘non-work day’ can only be used on another non-work day.

How Much Will The SA Export Tariff Cost?

Electricity retailers will be charged 1c per kWh for exports from customers with interval meters and .75c per kWh for customers with accumulation meters; above the free daily thresholds between 10am – 4pm.

SAPN says if a retailer passes on the tariff in full, for the average household (5 kW inverter and medium self-usage/exports) it will cost approximately $1.50 per month. For the average small business (based on a 15 kW inverter with medium self-consumption/exports), it will cost approximately $6.00 per month.

SolarQuotes’ Ronald Brakels crunched some numbers relating to households with a smart meter, and here’s what he came up with.

“For 6.6kW of north-facing solar on a home with typical electricity consumption, it will come to an average of around 0.5c per kWh exported in January – the highest output month. In June, it should basically be nothing. Very roughly, in this case, it will average around 0.3c per kWh exported.

 

For larger systems, e.g. 20kW, 30kW, it will get closer to 1c per kWh exported, but never actually reach it.

 

The result of the export tariff should be a small drop in solar feed-in tariffs offered by electricity retailers, but the export tariff will also contribute to more annoying solar system size restrictions on electricity plans.”

A Little Carrot With The Stick – For Some

SAPN mentions some customers may also get a credit above standard feed-in tariff rates if they export energy at times when other customers need it most.

“If you are on SA Power Networks’ customer choice Electrify tariff, from November till March, SA Power Networks will pay your retailer a credit of 12-13 cents per kWh for energy exported between 5pm and 9pm. You will need to contact your retailer to find out whether you are able to access this tariff.”

I believe this refers to SAPN’s “Residential Electrify” trial tariff — or something similar — mentioned here and here. It features stronger pricing signals than the default residential Time of Use (ToU) tariff.

Minimising The Impact

Maximising solar energy self-consumption through actions such as setting an electric hot water system on a timer has been the name of the game for years, and now even more so with the introduction of export tariffs.

But there’s only so much households can self-consume, especially if no-one’s home during the 10am – 4pm window. While the cost impact should be minimal regardless, the introduction of export tariffs in South Australia might also provide a little extra motivation for some to consider a home battery — particularly given the federal battery rebate official launch is less than three weeks away.

“Installing a battery will reduce the amount of export tariff paid, as it reduces exports,” says Ronald. “If people are desperate to reduce their export tariff amount, they could set their battery to only start charging at 10am. But I would not advise this for most households, as they would probably end up worse off by missing out on a little battery charging.”

For those considering installing solar panels, he added:

“Having east/west facing panels will help reduce the amount of export tariff, partially due to lower overall output compared to north facing panels, but also because they produce more outside of 10am-4pm and because these homes have higher self-consumption.”

Further information is available on the SAPN export tariff explainer page.