For some time, I’ve been both amused and increasingly disappointed by how people perceive solar feed-in tariffs.
I understand their concerns, but it’s disheartening how many lack critical thinking skills. And let’s not even start on a media landscape that often forgoes nuance for clickbait. The complexity of energy economics doesn’t fit into a headline.
Unfortunately, the increasing gulf between export tariffs and import tariffs is leading to some extreme anger and behaviour…
The Comments Section Blues
We have a case in point from an irate customer—whose comment remains unpublished1
Exhibit A:
I installed solar 6 years ago, The installer connected it to the analog meter, saying it will go backwards when it goes to the grid & forward as I use the power mainly at night, it always hovers a bit over a bit below, has not changed much in 6 years, At 1st AGL “Criminals” used to pay me BTW I will “NEVER” get a Dumb meter ! Now they refuse to recognise my solar, But THERE IT IS ON MY ROOF ! hahaha, They estimate it right, my last bill was $9600 LOL
So they are using power I produce from the sun, “STEALING” then they want to charge me for their “THEFT” Double dipping I,d say. So called smart meters are Dumb, they steal your power & change the value of export & import, with your digital meter, to their benefit, thankyou stupid, AGL just made 7 billion last year, oh theres a power shortage, Lmao WAKE UP, Stick with your honest Analog.
I wonder if this gent criticises youths publicising misdemeanours on TikTok? All the while being blissfully unaware that the penalties for electricity theft look like his electricity bill but with many more zeroes attached.
Ever More Complex Tariffs Don’t Help
The electricity retailers have weaponised complexity in the hope that people will just give up making comparisons and take whatever deal is on offer. There are percentage discounts, daily charges, subscriptions, memberships, block pricing, TOU, feed-in, shoulder, peak, off-peak, controlled load, solar sponge, free time…
Thankfully, we have services like Bill Hero and Solar Analytics, which can look at your bills and calculate the cheapest tariff for you. I wholly recommend them because if even Bruce Mountain, a literal professor in energy economics, can’t get himself a good deal, then – without help -nobody can.
Flat Rate Tariffs Will Eventually Disappear
Flat rate usage tariffs and access charges are from the steam era, when meters were clockwork and generators coal-fired. Australians are increasingly being forced on to Time Of Use Tariffs with peak, shoulder, off-peak, and sometimes super off-peak rates depending on the time of day.
In the digital age, we’ll use most energy when it’s cheap and abundant. Demand has always followed daylight when people are awake, and that handily coincides with solar energy, so we need to adjust our thinking along with our hot water services. The surplus of solar has now made daytime rates the cheapest of all2.
Many find variable electricity pricing baffling, but there’s no shortage of examples proving that people often miss the obvious. For instance, inner-city parking may cost $30/day, but it’s free after 7 pm. Public transport costs half as much between 9 am and 3 pm. So, consider how the price of energy changes throughout the day.
Variable-rate feed-in tariffs are also becoming more popular. You can’t expect to push your solar electricity into a flooded market and demand a premium price. Some retailers will pay a significant feed-in tariff after 3 pm, which can be lucrative for big systems, especially if they face west.
Why Is Retail Electricity Pricing So Much More Expensive Than Wholesale?
The average wholesale power price in SA for October was 1.512c/kWh, while flat-rate retail deals cost around 45c/kWh. What gives?
Bulk energy is bought at bulk prices on long-term deals. Retailers buy an average amount on a forward contract, and if there’s exceptional demand, they can turn to the volatile spot market to top up.
Of course, if there’s an unexpected war, flood, fire, or plague that disturbs the supply (or demand side), the pricing impacts are delayed until the new contracts in the new year flow through to us, the end users. And when the recent price hikes hit, many smaller retailers found themselves unviable, they pulled up stumps and left us with less retail competition.
There are a lot of other expenses involved. The networks are big and stringy and cost a bomb to maintain. Copper losses on hundreds of kilometres of poles and wires means just 26% of the heat created by burning coal makes it through to your toaster.
Regional Queensland’s Feed-In Tariff Win
Energy Queensland has been ordered by the minister to use an avoided cost model for calculating regional feed-in tariffs because the energy you generate is very efficiently used by your neighbour’s toaster. So, while retailers have costs to hedge against extortionate spot prices, and those annoying call centres must be staffed, they now pay $0.1344 per kWh for Regional Queenslanders’ exported solar energy.
Premium Feed-In Tariffs Are History
44 cent rolled gold feed-in tariffs were a boon. The state-based incentives established a whole new industry, along with the federal Solar Homes and Communities Program (SHCP $8000 grant). Between them, these programs created the demand that trained workers, built businesses, taught skills, and ultimately made solar cheaper for everyone. It was a smart use of what some call middle-class welfare, channelling capital from those who could afford it to benefit everyone else.
However, early adopters may have been overcompensated, as the rapid fall in solar PV prices wasn’t predicted. Some argue that cashing in remaining feed-in tariff schemes now could encourage those who can still afford it to invest in more solar and batteries before 2028.
While feed-in tariffs helped get people thinking about energy and changed their behaviour, giving them a sense of entitlement hasn’t helped as the transition gathers pace.
Is Solar Worth It With Lower Feed-In Tariffs?
Forget about feed-in tariffs; the real savings with solar are using that solar energy in your own home. That’s why I always recommend filling your roof with as much solar capacity as possible. A larger system offers more energy throughout the day, reducing your reliance on purchased electricity. If there’s a surplus, that’s a nice problem to have. But when the sun is low in winter, you’ll appreciate the extra energy for running a reverse cycle air conditioner to heat your home.
A 10kW solar system in Adelaide with 30% self-consumption, 45c usage and 10c Feed-In. You can see the savings are dominated by self-consumption. From our solar calculator results.
The Battery Equation: Friends With Benefits
While solar batteries are an expensive way to use your solar power, they offer unique advantages. Every day, you’ll make a little return on the battery investment, and you can avoid being violated for up to 75 cents per kWh during peak times.
Where batteries provide unparalleled comfort is keeping the lights on. Though the grid is 99.998% reliable, it might only take one car crash down the street to defrost your freezer or kill your pet fish. Events like that can be a priceless return on investment.
You Already Own A Battery
The average hot water service represents 30% of your home energy use, and while it might leak some heat, it’s cheap storage for 13kWh. A recent study by UTS Sydney tells us that electrification is more important than outright efficiency, so while a heat pump hot water service uses 75% less electricity, using a conventional element to heat water with surplus solar is still a great idea compared to burning gas.
We’re All In This Together
When exporting power, you’re reshaping the future, bringing democracy to energy. The power industry isn’t stealing your electricity. Even if you’re paid nothing, you’re driving the price down for your neighbours and making life hard for the corporations who own the coal burners. For far too long, they have been polluting the air and water scot-free, so it’s about time things changed.
Even better is if you can stick it to the oil industry by storing electricity in your EV.
Your house can be a tiny-scale version of the broader grid. Build excess renewables, put timers on your appliances, or divert kilowatt-hours to storage and use them later, but generally try to have vast capacity on the roof so that even rainy days will power your fridge and lights. The vacuuming, dishwasher & clothes dryer can always wait.
Footnotes
- When people caution you to avoid the comment section, remember, dear reader, we’ve already cleaned it up for you. Some of the stuff we cut is truly mind-boggling. ↩
- The cheapest wholesale rates are daytime, but in coal-fired states like VIC, QLD and NSW, the cheapest retail prices are still overnight ↩
About Anthony Bennett
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Always love your pieces Anthony, thanks.
What are your thoughts on consumer private trading of surplus solar, like an Uber model? I see AEMO have factored that into their strategic planning as a possible service the grid may need to support. Selling your surplus to friends and family directly, at say half the retail price, rather than through the intermediary of a retailer? Obviously a grid-upkeep fee would need to be included in transactions, and a balance found between retailers and individual market mechanisms, as we’ve seen with Uber-type mechanisms in other industries.
Look up LocalVolts Nick 😉
Well now…
🙂 Thank you.
Hi Anthony,
Interesting, the LocalVolts company.
What’s your take on them, their operation and efficiency?
Regards,
Andrew
I’ve actually got to write an article on them Andrew,
There is a fakebook group of course so you can check there.
I had a look after Anthony’s recommendation and it seems a brilliant platform. However the more I crunch the numbers on daily wholesale prices, the more I find that a good retailer is probably a better option for me, with a half-decent FIT. The review of Amber I saw here also said similar, that the savings weren’t that significant, particularly for somebody with an appreciable amount of solar to export. LocalVolts on first inspection also didn’t seem to have much protection against negative wholesale prices, which can mean you paying to export.
But I’m happy for somebody to prove me wrong! I love that these platforms are out there and available.
Nailed it Anthony. The comparison with parking and public transport is good too.
There are so many comparisons that I don’t understand why some people just don’t get it.
I have zero doubt that we will all be on time if use tariffs with smart meters in the not too distant future. It’s only logical, and the only way to make some people smarter about when and how they use power. (I know people who charge their electric cars routinely in the evening peak, and when I mention it to them they just say “stuff them, not my problem” or similar. So the sooner we’re on time of use charges, the better!!
Interesting article. I’d say the root cause is the government selling off our infrastructure to lower their debt ratio.
Understand that private companies need to make profits through.
Whoever decided to sell off the infrastructure in the first place should be held accountable.
Electricity, Water, Telecommunications should always be owned by the people and administered by the government.
As for the FIT price, buying at 5 cents and selling back at 55 cents is unconscionable conduct as far as I’m concerned.
I think you hit the nail on the head. Electricity is pretty much a natural monopoly. I am not sure, but I suspect privatising it and then regulating it is less efficient than making (or keeping) it publicly owned. Perhaps we could discuss that over a glass of red one evening…
On the other hand, governments aren’t known for their eagerness to make changes.
Most Canadians have a government electric utility, but Alberta is completely deregulated. If you’ve got a spinning shaft or falling water or extra steam that’s currently unemployed, they want you to hook it up to the power grid and put it to work
The end result is that in the past year, 3/4 of the new wind and solar generation in Canada, was built in Alberta. And not much was built by the old, stodgy utilities.
I know nothing of how they do things in Alberta. Perhaps it is a good model. Does the business model of the power companies there encourage its customers to be energy efficient? Is there any financial incentive to do so? Solving environmental problems is much easier with decreased consumption. That way a few unemployed streams could run free.
In South Australia’s case it would be John Olsen
Rob Lucas was the treasurer heavily involved, he only just retired at the last election in fact.
Why aren’t retailers paying higher fits to regional NSW solar producers. They charge us a higher daily charge and higher tariffs claiming it is to cover the extra cost of poles and wires to get the power to us.
If this is really the case the power produced by solar in regional areas is reducing the need to transport power long distances from generators to regional consumers and therefore, using the retailer’s logic, the power generated by solar producers in regional areas is worth more per kWh than it is in cities.
They are happy to discriminate against regional consumers when selling their electricity to us but not when buying it from us.
The NSW government needs to follow the lead set by the QLD government.
The main cost driver for the transmission and distribution system is peak load.
It doesn’t matter that new solar is reducing the total amount of electricity shipped into your area. All that matters is how big and how long the wires need to be.
And once they’ve built the network, the only way to get their investment backnis to charge fees. And the fees can’t go down because the hrid construction is a sunk cost.
I think you’ve missed the point. I’m stating the arguments used by the power companies. That it costs more to transport the electricity to me due to losses and infrastructure between generators and me.
I’m a net producer. I’m putting energy into the grid at peak times during the day. Using their arguments or is unfair to penalise rural consumers for the so called cost of transporting electricy to the city when in my case I’m sending electricity the other way or offsetting peak demand in my area.
And if they are trying to recoup network costs then charge city consumers the same daily charge as they charge rural consumers.
Was it Truffles or Five Jobs or Anxious Failure who promised us simpler ‘Bills’?
I used to key my past usage data and several plan choices into a spreadsheet to be pretty sure I had the best deal.
Now I would struggle. And Energy Made Easy is a joke.
Hi Rod,
Best approach I have had is either Solar Analytics with their bill manager.
Or Bill Hero is a winner,
Even WattEver makes energy made easy look pretty useless.
Thanks, will have a look at Bill Hero
These days my only criteria is a high FiT as we are mostly off grid and import 4/5 of.
Unfortunately, in SA that means AGL
A simple rule of thumb is to look at the margin between the price for power from the grid vs the FIT as a % of the grid price.
Some ‘retailers’ offer a relatively high FIT as a hook for the less educated consumers who don’t notice the also much higher from grid kWh costs.
It is very straight forward for people on a flat tariff structure, and only slightly harder for those on time-of-use tariffs. They have to input several times the amount of data each billing period.
Depending on how ‘financially-literate’ you are then a simple spreadsheet where you insert a new column each bill – will then allow you an accurate comparison of exactly how you will gain/lose from a new retail offer.
You run two blocks of calculations. The 1st to recreate your existing bill history (and thus confirms your formulae are correct) and the 2nd block where instead of reading the current Daily service charge, grid electricity cost/kWh & FIT/kWh you change the reference cells to the ‘new offer’ figures.
This way you can see exactly how your bill would change if the last year’s, or longer, usage was repeated going forward.
Totally agree with Anthony re his article esp using resistive element hot water heaters as means to soak up excess solar. I would add that physical battery systems dont have to be big to be effective. A home’s base load is not usually very big. I.e. Tv’s PVR’s networking equipment, fridges, freezers, washers using a hot water feed off HWS, and light circuit isn’t usually a big load. And a small hybrid inverter hooked to a 5kw battery runs my home’s base load very well. For hi current appliances there are grid connected circuits. Low current appliances and lights circuits etc may not be a big part of ones total current capacity but often is 60-75% of KWh used so are the low hanging fruit that’s easy to take off-grid.
I would be happy to get no export credits and donate the power to people who are maybe doing it tough or are in a situation where they cannot fit or afford a PV array.
Maybe a job for one of the charities and the end user would only have to meet a modest charge for use of the poles and wires?
Hi Ian,
Have a look at LocalVolts, they may be able to help.
Sadly they are not in WA.
The infeed tariff is not the main concern here if it is a constant price for all infeed power but when the power companies split the price with the first number of kW hrs worth more than the following kW hrs. It becomes impossible for people to restrict their infeed to the higher price. As anyone that has paid to upgrade the size of their systems because of the increased power charges and lose the initial high infeed rate are restricted to a maximum infeed rate, in our case 5kW I feel that this new system is a deceptive way to buy power so that people can’t stop their infeed automatically after the first limit is reached. The ACCC should investigate this as an illegal restriction of trade because of its operation in the way consumers lose control because of the structure initiated by the power companies.
“Copper losses on hundreds of kilometres of poles and wires means just 6% of the heat created by burning coal makes it through to your toaster.”
It couldn’t possibly be THAT bad.
Maybe 30% of the coal’s heat energy comes out of the power plant as electricity and 20% OF THE 30% (6%) is lost along the way. So 24% of the coal’s heat gets to the toaster.
But yes, solar PV is better. But not as efficient as my just-invented, theoretical, fresnel lens solar toaster.
Agreed, I’ve updated the post.
Thanks Anthony. Coincidentally, I was wishing for such an article to link to just two days ago and was scanning the SQ contact list for your details. Turns out you were already working on it. 🙂
However, I’d hoped you’d go a bit harder at the fallacy that retailers buy your power at 5c and sell it back at 55c. So many people get upset with this canard. Leaving aside network charges, there is usually a big coal generator undercutting that 5c by a further 10c – paying the grid to take energy at the time people are expecting to be paid for feed-in. For most of the year, 5c is a generous retailer payment to keep a customer – an overhead for the retailer. Why else would they set a limit on system size if they were making a killing reselling rooftop solar energy?
The only solution to low FITs is storage and load shifting.
Fallacy? People only need to read their power bill to see it’s not a fallacy. Retailers buy power from homeowners for 5c or so, and in, I’m guessing SA, sell it back for 55c – it’s lower everywhere else. Customer already have to pay network charges and connection fees so either the retailers are making 50c per kWh they buy, or they’re having to buy power they don’t want. Is there an alternative?
How can coal companies undercut the 5c exported solar power is worth by 10c? That’d mean they’re paying retailers to take their coal power – not a profitable model!!!
Storage currently isn’t financially viable for most people, and the ability to load shift is limited. Unless power basically doubles in price – which will destroy those already struggling to make ends meet, especially those on low incomes, batteries will remain a luxury item. If power prices rise to make them financially viable however then demand will exceed supply and we’ll have the issue of house fire risks and environmental concerns.
Random thought. Coal power has provided cheap reliable energy to Australians for decades. Solar power, especially home solar, is seen by some as a replacement, or partial replacement. Do those who espouse it, and those who comment here, come from the upper financial deciles of Australians? Does the bottom half, or bottom quarter, see things differently? As I say, just a random thought that crossed my mind.
Hi George,
Around 12 or 14 years ago the best customers we had were actually the ones in the decidedly budget postcodes around Paralowie, Salisbury, Elizabeth, Hackham and Christies Beach. These people, along with the farmers around Ceduna, were very price sensitive and knew a bargain when they saw one.
Those in the well to do suburbs just paid the bill because they could, and as the cost has risen they’ve found that running a pool, spa heater & ducted air conditioning is actually quite expensive. Some of them still refuse to have solar on the front of the house, less they be judged as poor. Happily those with a decent budget are now the ones adopting a fully electrified home, with solar, battery, heat pumps and EV as a kind of fashion statement.
People romanticise “reliable coal” without realising the data tells us that as more renewables are deployed, grid reliability has only gone up. And they ignore the fact that people in Morwell and Port Augusta have decidedly worse health, like double the rate of lung cancer.
There are indeed times when coal is effectively paying to generate because it’s too expensive for them to turn the boilers down and stop the turbines. That’s why AGL have shut down the steam engines at Torrens Island A. They’re 50+ years old and they’ve been replaced in favour of fast start reciprocating engines.
“People romanticise “reliable coal” without realising the data tells us that as more renewables are deployed, grid reliability has only gone up.” Absolutely true, has the data around that been written up somewhere on Solarquotes? Would be great to have.
Hi Nick,
I like to point out that it’s so obvious even the anti-renewable party is claiming credit for it.
https://reneweconomy.com.au/five-years-after-blackout-south-australia-now-only-state-with-no-supply-shortfalls/
Interesting response Anthony. Certainly contrary to my own impressions – though I admit I don’t have a clue where the place you mention are, though a Duck did say there’s a Salisbury in both South Australia, and another in Wiltshire, England.
Factor in that the Teals were more the 1% type electorates, and it’s not what I’d’ve expected. Not bad, just unexpected.
As regards South Australia being the only state with no supply shortfall, doesn’t that directly contradict the AEMO warning that SA and Victoria are particularly vulnerable to blackouts this summer? Or are supply shortfalls and blackouts considered different concepts?
Hi George,
I think the technical term is “unserved demand” and there’s been none in SA for 5 years.
There are still outages of course, local farmer to us fell asleep and took out half the district when his tractor moved down a SWER line. Large storms take out thousands of customers but again these are exceptional events.
The warnings out now are basically AEMO getting in front of the issue, where they had arguably dropped the ball in 2016.
George yes at some periods during the day coal generators have to pay for the power they put into the grid, the wholesale price becomes negative. The coal generators balance this out because the wholesale price is higher at late afternoon through to 9-10pm, ir after all solar stops generating.
There are people who this feature via a retailer like Amber to fill batteries during the day with the price is negative and they sell that stored per back at night. They get paid to both fill their batteries and discharge then.
Yes, it’s a fallacy. Looking at the numbers on a bill to conclude your retailer is getting 55c for something they paid you 5c is an uhelpful simplification of a very (over?) complicated energy market. The retailer does not get 55c.
See Anthony’s pont about October’s SA wholesale spot price being 1.5c/kWh. That’s a big clue as to why your retailer is begrudgingly offering 5c and placing limits on how much they have to buy from you at 5c.
If your fixed rate is 55c, that is a grand average for the year including the rest of the day when you have no solar to sell, and includes those occasional night-time peaks of $5-$15 / kWh. Your retailer has placed their bets for the year and worked out what it needs to sell at for 24x7x365.
Of course a lot of power is sold on contracts, not the spot market, so it’s even trickier to understand.
Anyone who can, (apologies George, I suspect you are in regional Qld and don’t have a choice), is free to seek a better FIT on the spot market through Amber Electric. You’ll get what all the big generators are getting. It’s a real eye-opener. We turn half our panels off most days during Spring. The energy is worse than worthless – pay to feed in. Of course it’s often worth plenty in the early evening though. Welcome to the reality of the 2023 duck curve.
George, you seem surprised coal generators are paying to generate during the day. That’s exactly what’s been happening for the last few months in Qld on most days. It’s 6.50am now and the spot price in Qld is minus $20 already. But at 6pm tonight the forcast is $370, occasionally it’s $15000. Although they have done OK in the last 12 months, your prediction is correct, they probably don’t have a profitable model. Hence the closures.
By storage, I didn’t mean home batteries, although they certainly come into play at 55c. I meant Borumba, Pioneer-Burdekin, Kidston, Baulderstone, Western Downs and whatever Twiggy is planning with Hydrogen. Plenty can still be done with load-shifting
Glen, yes I saw the average spot price was ~1.5c/kWh but how’s that figure is arrived at, & what proportion of power is purchased via spot prices? If SA power is so cheap to produce, & capital so inexpensive, then why are SA FiTs so high? Aren’t daily supply and metering charges supposed to cover all the hardware costs?
My retailer doesn’t limit how much they buy at 5c, only at the bonus rate – something like 5,000 kWh/year from memory. This year I’ve exported close to 13,000 kWh and should reach 15,000 kWh by the end of this year – it’s slightly down this year because low FiT mean greater AC use is more attractive. If export limits were imposed, well frankly it’d likely cease being worthwhile remaining on the grid – cheaper to switch over to fossil fuel backup generator + modest sized battery. I can’t tell how much I’ve self consumed as my inverter data has been scrambled 6 out of 11 months this year thanks to blackouts and a case of storm surge induced internet issues, but for those months not scrambled it looks to be roughly 50:50 grid consumption v self consumption, with the latter rising thanks to AC usage.
I actually do have choices, just none better than what I’m presently on as best I can tell. I did look up Amber since you mentioned it but according to their site they’d only be paying 2.7 c/kWh i.e. half what I’m on now. They also say low use high export customers, like myself, are advised to look elsewhere. Thanks for the suggestion though.
I tend to fall on the if it ain’t broke don’t fix it, slow and steady side of the equation so while I’m not opposed to some solar etc, and am usually happy with the system on my roof, I’m just not eager to see the country dive head first into it without making sure the pool has enough water in it to not break our necks. Yes I can always go off grid if whomever screws the grid up too badly, but not everyone can make that switch and there’s already far too many people screaming about cost of living woes.
” I saw the average spot price was ~1.5c/kWh but how’s that figure is arrived at, & what proportion of power is purchased via spot prices? ”
All electricity prices are exposed to the spot price, even those behind PPAs and the gentailers. If you’re a gentailer and the spot price is low or even negative, then you’re incurring an opportunity cost in keeping your own generators online vs buying cheaply (or being paid) on the spot market.
If you’re a generator bound by a PPA, you can shutdown and buy the shortfall from the spot market. The limitation is in how fast and cost effectively you can spin down and spin back up again.
If you’re a major customer (or a retailer) bound by PPA, you have to pay the difference between the spot price and your PPA price to the generator.
So even if the volume sold on the spot market is small compared to total generation, the whole volume is exposed.
One issue to consider with your solar is that most of the energy generated is during peak sunlight hours say 9am-3pm which is when most people are at work not using the solar generated power at home so it goes into the grid. This is one benefit of a solar battery option, it stores the power generated during the day to be used when you want it.
My situation seems rather different to most. I buy grid power for $0.08/kWh between midnight and 6am, so I charge the EV and run the HWS, dishwasher, and washing machine during that time. I pay $0.35/kWh at other times, so I minimise power usage then.
There’s 16kW of solar panels, for which I get $0.10/kWh FIT, uncapped and unlimited. So I make $0.02/kWh profit on the ~90% I export, which at this time of year is between 70-90kWh.
It’s a purely financial arrangement which still consumes coal-generated power, but the generator is slowly moving to renewables, which is good to hear.
“Copper losses on hundreds of kilometres of poles and wires means just 6% of the heat created by burning coal makes it through to your toaster.”
This statement certainly isn’t true. An old coal boiler converts 30% of the heat from coal into electricity. The new ones do 40%.
Marginal loss factors in the transmission network are significant, but certainly not on the order of losing 75% in transmission. A congested part of the network will be able to transfer 75% of the energy, losing 25%. The network connection at the old coal units aren’t where the congestion is, mainly due to those units running at lower than original design load, helping reduce copper losses
Worst case is on the order of 22% of the heat from coal reaching your toaster.
Thanks for the calculations Matt,
Solar on your roof doesn’t suffer the same losses, in fact the rules are that there cant be more than 2% loss between the inverter terminals and the point of supply from the street.
I think we’d all agree that 22% is pretty dismal though, considering the effort and expense involved in coal burning, especially seeing as the coal industry has externalised the pollution expenses. Coal ash represents 12 billion tons of waste annually and doesn’t really pay for the environmental or health damage it does.
Currently on the 44c feed-in in regional qld and I certainly don’t feel entitled with the recent price increase iv had to ensure my plans to upgrade the system “dropping the 44c feed-in” could probably go off-grid with only a extra battery because 1 or 2 more price increases like this and it will be cheaper to go fully off-grid and accept the risk of the rare outage.
Before price increase the usual bill was approx minimum of $800 – $200 solar credit, a quarter. Haven’t checked in a while but i think the estimate was between 30-40% increase
“also think the last bill ended up being a estimate so don’t know for sure yet”.
Just bear in mind Nathan,
You’ll need backup. After 15 years doing off grid solar I can assure you it’s invariably the backup generator that gives most trouble. The grid is cheaper, quieter and more reliable to have than any generator. In fact just paying someone to turn up once a year and do a service costs more than the grid does, even before you consider fuel, capital cost and a cranking battery every few years.
For reference these are the current/recent prices.
From 1 July 2023 COST
All usage per kWh $0.33250
Supply charge per day $1.20473
From 1 July 2022 COST
All usage per kWh $0.24349
Supply charge per day $0.99449
Im not planning to cut the mains anytime soon but I’m looking at a system with enough battery capacity i should usually run on generated power more then enough to all most always have a bill in the negatives.
Long term my main concern is if these price increases keep coming.
I can’t significantly reduce my power usage anymore sadly where i live needs regular usage of a aircon and a dehumidifier and I’m home most of the day
So i cant try to compensate in that way.
Currently looking at 10kw REC panels with a 10kw inverter and without checking the documentation over 14kwh in batteries.
Right now im waiting on news from that HEUF scheme before going either ahead with it or going though my savings and getting it sorted early next year.
10 kW in solar panels with a 10 kW inverter and 14 kWh in batteries? Might you not be better off with 13.3 kW in solar panels – 30% loading is usually recommended, and perhaps a smaller battery? This does assume you’re not with a retailer like AGL who caps the system size including panels at 10 kW, not just the inverter.
I do intend to have extra panels but considering the system im looking at is solaredge micro-inverters im going to see about salvaging the current 5kw of panels for that before thinking of buying more over the base load.
Everything i can find says it would be fine with how the micro inverters work but im still going to wait on what the installer says when i can actually start hashing it out with the installer.
And thats mainly waiting on hearing how the HEUF ends up being rolled out.
So i can decide to apply for it or drain my savings/wait to early next year
“Mainly to avoid digging into my investment account and instead just drain the debit ones”
Sry in advanced for and spelling/sentence issues im exhausted and just got spooked out of any attempt to sleep by smoke alarms going off.
“As far as i can tell it was a surge or something that set them off”.
Your getting kW and kWH confused.
In 2011 I was told how installing solar was not only going to solve my energy costs but help the planet so, I spent almost $4,000 on a 7 panel 1.5 Kw solar system.
At that time I was paying 19c per Kw/hr to buy my power and the government guaranteed me a 40c per Kw/hr as a feed in tariff until 2026 and the electricity supplier topped that up to 60c. What a great deal, but boy have we been hoodwinked!!! In 2019 to combat spiraling energy costs I installed another 5 Kws of solar, and in doing so cancelled my guaranteed feed in tariff and I had to settle for 27c pr Kw/hr and my buy tariff had jumped to 31c . We were still told we were getting a good deal and our year round electricity cost would be very minimal. Each year the government praised themselves by keeping power cost increases in check…..really!!!
Fast forward to August 2023 my feed in tariff has fallen to 5c pr Kw/hr and my peak buy tariff rose to 64c pr Kw/hr.
I have spent almost $9,000 to be no better off than if I had ignored all that ‘great advice’ along the way.
We have been screwed. Would I have installed solar back in 2011 if I had a crystal ball and could have see where I have ended up by trusting people and doing the right thing…..NO WAY!
Battery storage technology is still a decade away from being a viable cheap option and governments in Australia are to be damned for throwing consumers to the mercy of retailers who are trying to buy from an antiquated generation system that should have been kept up to date the way it has in the rest of the world.
Australia now has the most expensive power supply system in the world and the only ones that have benefited and solar promoters and installers.
I wish I could have the last decade over again, there is no way I would go down the path and trusted the people that I have.
Robin Shannon
Hi Robin,
Do you have any numbers for consumption and generated kilowatt hours? I’d be fascinated to know what they are if you’ve kept records because I have often written up total numbers on people’s meter box when we have replaced a failed inverter.
If we assume very broad rules of thumb 1kW of solar generates 4kWh/day.
At 4kWh/day your 1.5kWp system should have generated at least 17520kWh over 8 years, for which you invested $4000 or 22c/kWh. If you only exported 38% of that energy at 60c/kwh then you got all your money back and the rest is cream, it’s either generated credits to cover the rest of your bill or avoided the cost of buying power in.
The 5kWp system should yield at least 20kWh/day. That system has generated 32850kWh (?) so in 4.5 years the $5000 invested means you’ve paid 15c/kwh for energy that would have cost somewhere between 31c & 64c had you bought it in.
Cheers
Unfortunately there in’t a mechanism where I can post a screenshot of my August 2023 account but rest assured, for a 2 person retired couple it was more than $400 for the month….and I have 6 Kws of solar on my roof!
Anthony you can quote all sorts of figures but pal, I live in the real world, and my monthly bills are of more importance to me than the supposed figures you suggest I should be achieving. And let me tell you, both my installs were through recommendations from ‘Solar Quotes’!
Cheers…….Rob
Hi Rob,
You’d pay $40/month for access charges maybe?
$360 ÷ .64c = 562kWh or 18.75kwh/day.
Add to this the 12kWh/day your solar should generate (assuming winter yield is half your daily average)
Average daily consumption figure is printed on your account by law, so it’ll be easy to find, but my guesstimation is 31kWh/day.
That sort of consumption isn’t exceptional but it’s by no means modest.
I hate to recommend the Zuccerburg empire but
https://www.facebook.com/groups/MyEfficientElectricHome
My Efficient Electric Home has a great community of 100 000 like minded Australians who are ready and willing to offer ideas and valuable expertise on electrification.
https://www.rewiringaustralia.org/
https://electrify2515.org/
“Anthony you can quote all sorts of figures but pal, I live in the real world, and my monthly bills are of more importance to me than the supposed figures you suggest I should be achieving. And let me tell you, both my installs were through recommendations from ‘Solar Quotes’!”
I live in the real world and something doesn’t seem right here. Particularly if you’re retired and therefore able to self-consume a lot during the day time. My SolarQuotes recommended installation (for a family of 5) hasn’t cost me a cent in electricity in a year, in fact we’re in profit for the year of about $500 at my last calculation. That’s with a battery I should add, but also consuming nearly all of our electricity in peak times, we’re not home during the day.
I got a 4 kw system installed in april this year, and because I’m home during the day I use some of the generated energy, My bills have halved since the install. Pre installation I was paying around $100. per month, now it’s between $50 to 60. I also took advantage of the globird energy “free lunch” plan which gives me free power between 12-2 pm, and charges 24 cents per kw/h flat rate for the other 22 hours. I don’t use an aircon often, maybe 3 or 4 days per year, but do use an 1100 watt bar heater for the coldest winter period, but not all day, maybe 4 to 6 hours per day. Sure the solar system cost around $4700 up front, but with the way the sharemarket has dived I’m glad that I didn’t invest that $4700 in shares..(it probably would have halved) I live in Victoria where the power prices are a lot more reasonable. I’m also expecting lower bills now that summer is approaching. Strangely, a solar system seems to be a more viable investment in victoria where there’s bugger all sun for months in comparison to the sunshine belt.
Robin, here in regional NSW we have a total of 5KW solar, no battery and a normal 3 Phase grid connect. With two retirees our monthly bill averages around $45.00. Our KWh charge is around $00.31 and FIT is $00.07.
You may need to find out why your bill is extremely high, but may be due to excessive usage of aircon. We have a 20KW ducted aircon which is only used on our occasional “bad” days due to high running costs and no swimming pool.
Chris Thaler: Chris, it’s a matter of priorities. I am 79 years of age, I live in an 80 year old stone home in the Adelaide Hills, I have a disabled wife and consequently have a substantial requirement for both heating and cooling.
On a good day I can produce 48 Kw/hr of electricity from my 23 panels.
When I installed this I was told I was future proofing myself with not just free summer energy but able to put enough aside to subsidize my bill when my solar production can be as low as 7 Kw.
This is why I did what I did, I trusted peoples predictions. I would have put in more solar but the government restricted what I could export back to the grid and earn something on…..what would be the point if I couldn’t use it, and also couldn’t get paid for it.
But my 60c/pr Kw input tariff disappeared, then my 27c/pr Kw disappeared and I am now stuck with a feed in tariff of 7 useless cents while my current peak buy rate via Lumo energy is 51c pr Kw/Hr.
I have changed supplier 5 times since 2010 trying to get a reasonable deal from AGL to Origin, to Energy Australia, to Power Direct, to Sumo energy to Lumo Energy and I am at my wits end.
At the most recent install the supplier tried to talk me into spending yet another 9-10 grand on a battery! Maybe if I was 50 I would consider it but at age 79, do I need to be pouring yet more money into something that someone else is going to actually get the benefit of? As I said, it’s a matter of priorities, I am better off spending that money on some of lifes enjoyment for what years I may have left in this property.
I am done with all the talk, all I have done is spend money to waste it, all because people told me I was doing the right thing whilst the goal posts keep shifting sometimes twice a year.
Cheers……..Rob
Hi Rob,
I appreciate where you’re coming from but by the same token I did a job for a bloke by the name of VanSelden at Victor Harbour. He was waiting for god as he put it, but decided he was going to leave a legacy with some solar. If he’s still waiting he’ll be 97 this year I think?
Best advice I can offer is to look up Bill Hero and let them make comparisons for you. There’s a subscription to pay but they promise you’ll save more than it costs or they’ll refund it.
One aspect that stands out immediately is that you seem to be on a time-of-use tariff.
Only 3/10ths of virtually nobody (residential customers that is) are better off on a TOU tariff – that was how a certain investment bank presented them to the power companies.
Ok, maybe it is slightly higher than 3/10ths of nobody, but not significantly.
Typically, unless you use your AC as a heat sink (have it running during peak solar generation say 10 through to 2pm) to either slightly overheat your home or over cool your home so that in the late afternoon/evening your home is close to your desired level without needing to run your AC as a heavy load using grid sourced electricity – there is not that much ability (without a battery) to time shift that significant an amount to your high usage times.
Cooking the evening meal, using the lights (LED of course) and watching some form of screen (the modern curse) are all pretty much locked into a short ‘peak period’ which if on a TOU tariff is designed to cost the typical residential customer more than on a flat tariff.
One issue nobody has considered is that your home may not have much, if any, insulation and thus does not allow you to ‘time shift’ your AC use that greatly.
I suggest it may be worthwhile having a look at the last twelve months of bills, total up the kWhs used each bill and then multiply out the figures for some of the flat tariff offers available.
Hi Robin
I wonder if your system is functioning properly. I think the calculations people have offered are reasonable. If they don’t reflect your reality, I can see two possibilities:
1. Your system is not functioning up to spec (shading issues, faulty panels?)
2. You are consuming a lot of energy when you are not generating it.
I have a swim spa and A/C. Except in exceptional circumstances, I turn off the A/C as the sun is setting and open the windows. I lower the blinds on the east facing glass just before the sun comes up. Shortly thereafter, I close all the windows and lower the blinds on the west facing glass. I turn on the A/C when the inside temperature exceeds 26. I have the spa programmed to only turn on in daylight hours. I can get stung on cloudy days.
For reasons I have yet to diagnose, the spa sometimes kicks in when I have told it not to. The spa is easy to spot, because it consumes 4kW when it is running and heating. I estimate when it comes on sporadically at night it consumes around 2-3kW-hr.
It is early days for me. I have only had the panels just over a month. I check the app several times every day to see when to do things like dishwashing and clothes washing. The clothes washer doesn’t consume much, but the dishwasher draws over 1kW and runs for at least an hour (depending upon the cycle selected.
Currently the HWS is on controlled load (off peak). I am going to wait until winter to evaluate whether or not to switch it over and put it on a timer. There is much room for improvement, but I am shifting load where it is easy to do so for big consumers.
I have a 10kW system and no battery. My FIT is .10 and consumption charge is around .35. This means I need to generate 3.5X as much feed-in as I consume from the grid to break even. So far the ratio is running around 3:1.
I think its is important to both optimise efficiency and adjust usage patterns to make solar worthwhile in most applications. There is no free lunch.
You would be in a minority if you are unhappy with your solar. Most of us who installed solar, even back then, are laughing all the way to the bank
You also made the decision to forfeit your Premium FiT
The comments about the grid in particular sound like they came from Sky views
If the installer did not mention that he’d lose the 60 cent/kWh tariff then that is very different to knowingly adding panels.
Unfortunately there are too many people who will happily profit from others lack of ‘expert’ knowledge, and take advantage of those who trust that who they’re dealing with will ‘do the right thing’. Something that is far less common post 2000 than it was pre-2000.
Caveat emptor must be assumed unless proven otherwise – self-interest too often is the guiding principle for too many businesses/people.
Hi Robin
Unfortunately you were given bad advice in 2011 to install only 1 5kW solar on the high feed in tariff. It is not big enough to iffset a household’s usage and feed into the grid to profit from the high FIT.
Around the same time in 2012 we installed 5.5kW solar on the high FIT in Qld and we simultaneously reduced our consumption with energy efficiency measures. We use now on average 7-9kWh a day and that is with a 55k litre pool.
The reuslt was that we earned $3500 per year from the FIT and did not pay a bill sine 2012.
So your outcome and mine was Very different. You can’t blame it on solar, but on bad advice you were given.
Exactly Diego, I trusted the advice I was given.
Cheers…….Rob
For most home owners with 10 kWs on their roof it would be VERY hard for them to end up using 30% of the power generated if they did not have electric HW and either a smart switch or timer to only heat during the day (say starting at 10am through to 3pm).
With a modern variable speed pool pump, even with a massive 500,000 litre pool – you only use between 3 to 4 kWhs running it for ten hours.
Moving washing to once per day during solar hours, with an efficient front loader, typically (according to the plug monitor device & agreed to the power meter) uses no more than 1 kWh at worst.
With a well insulated house, even with AC set to act as a heat/cool sink by running during 10-3pm then most home owners would be hard pressed to use 20% with 10 kWs of panels.
_________________________
For anyone who does, please if you can detail exactly how much is used by the major draws on your generated power.
You are an efficient and frugal household compared to the typical Aussie with solar :-). Solar Analytics claim the average self consumption is 45% from their 20,000 systems under monitoring. Average system size sold today is close to 10kW. Winter self consumption can really up the average.
Just for fun I looked at my self consumption from 15 kW of solar yesterday – 78%. But I do have an all-electric house 2 x EVs, pool and Finnish sauna, so not really typical. But an EV topped up daily and electric hot water is a step-change in self-consumption.
Yep, winter really ups the self-consumption %. And I also factored in future EV charging. We have oodles of excess in the sunnier months, but an EV will soak up a chunk of that, and I’m even thinking about offering some to friends and family through LocalVolts, for additional income. Though still need to think through how that would work in the winter, and with negative wholesale pricing .
Reminds me, Finn have you looked at the wholesale spot pricing for South Australia on the AEMO dashboard? It’s completely flat-lined at zero. Can’t post a screenshot here on this form I don’t think. It’s nothing like the other States, I wonder if this reflects its level of maturity of build out to renewables, which is projected to hit 100% by 2026? There’s a story there to be told I’m sure, the graph is remarkable when comparing with other States.
It’s a charting artefact, I see now. AEMO uses a linear scale and that one massive peak has flattened the rest.
Yes, 2 EVs would certainly change the self-consumption equation noticeably.
Looking through our daily data going back some years showed that the amount of energy self-consumed during solar generation hours ranged from as low as 8% in summer to 15% during winter when we were on HOLIDAY.
So no ability to timeshift and equally no cooking, washing machine, screen use etc loads during daylight hours.
Swimming pool pump
Do you have a variable speed pump? What HP capacity is it? Have you checked to see what its daily usage is?
I came across a closet physicist moonlighting as a pool equipment installer/maintainer in California who stated that for running the same throughput (litres/hour) on a pool using a variable speed pool pump with twice the HP rating ends up using approx 1/8th the electricity.
I looked into this a little & then contacted him. His explanation checked out, and as I had to replace a single speed pump that was past its prime – I sourced a 2x HP variable speed pump to that several local providers had suggested. The result – running it for 10 hours for an extremely large and deep pool (9′ diving deep end) uses under 4 kWhs a day. Water throughput is around 5% higher than the recommended level. I did also oversize the filter by 50% which reduces the PSI required by the system as well.
If only there was an equivalent to LCOE done for pool pumps!
The additional cost for oversizing the filter was nothing, similarly the particular pump I chose more than paid for itself in electricity savings in its first 15 months installed. Never thought of variable speed pool pumps as akin to solar panels – just with a much shorter payback!
Efficient and frugal, or perfectly unexceptional?
I checked yesterday’s figures ~77 kWh generated, ~66 kWh exported, and self consumption of 14% or 11kWh. Note that’s with AC on throughout the afternoon and with a glass wall on the west.
There are no EVs, pools or Finnish saunas sucking up power however.
Grid use was just over 4 kWh – roughly half of which was the hot water cylinder kicking in close to midnight – it usually kicks in twice a day, but only did so once that day.
Note this is more a 10 kWh +30% system than the AGL approved 10 kWh max in panels, but close enough I guess?
Keeps it in perspective, thank you.
Thanks for the article, Ant. Top drawer.
Could someone please get the tech boffins to move the “reply” button to somewhere other than the spot that a right handed person scrolls the screen. I’m fairly ambidextrous, but they don’t make phone covers that flip to the right and allow me to scroll with my left thumb.
Everytime I scroll to the comments section I end up accidentally hitting the reply button on my phone.
Anyway, I’m going outside to yell at a cloud now. 😉
Cheers Ross,
We’ll see what the management says 😉
This was a very interesting post that generated (sorry for the pun) some good discussion. I did not read every comment, but I scanned them.
The article states, “Demand has always followed daylight when people are awake, and that handily coincides with solar energy”.
Not exactly, and a little understanding of the nuances can be useful.
Heating and cooling are the huge energy consumers.
The good news is that A/C and solar are a match made in heaven in the summer. Proper, i.e. passive solar, home design can make this match even happier. Thermal mass and insulation are very cost effective ways to lower room heating and cooling costs.
As the article states, a storage hot water system its an excellent battery for heat energy. It is interesting to me that for many retailers the off-peak tariff is nearly equal to the feed-in tariff. I suppose they are aware that the storage HWS is a good place to store energy, and they do not want to encourage you to invest in enough solar to do so.
I grew up in a household with a frugal electrician father who would remove the light globes if you left the lights on. But lighting was never the big problem. With LED’s the I probably expend more energy turning off the lights than they consume when I leave them on. (OK it is an exaggeration, but I could not resist a little swipe at dad.)
The two big problems are the morning and evening peak for cooking and room heating. If they are taken care of by burning coal via the grid, they will be significant once room cooling and HW heating are removed from the equation. Natural gas produces less carbon than does coal. It is strange that it is being phased out as not “green” enough. I would think most cooking takes place when there is not enough solar to do so, especially in winter.
Winter heating is highest during times with little sun. I solve this problem with a combustion heater. Not sure of the “greenness” of that, but I do cut my own fuel from demolition waste.
THINK WINTER!
Yay.
Someone thinking about what solar PV will do for them in winter.
Forget summer, summer is easy.
When we really want/need solar PV electricity…. for our electrified cars and homes… is mid-winter.
Depending on latitude and local climate, that expectation of doing everything with solar might not be realistic, even if you’re allowed to oversize it.
Most of Canada is getting little solar generation for only a few hours, this close to the winter solstice. However, the wind farms here are making electricity as fast as the utilities can haul it away… today
But a lot of the time we have to burn stuff to keep warm. And since the carbon tax came on several years ago, most of the coal power generation has shut down, replaced by gas, and electricity prices have increased. But there’s no tax on burning waste wood.
lets take the alternative.
Buy a $16K battery and warranted for 38500Kwh
$16000 / 38500 / 0.9 efficiency
= 46c / kWh to store it.
Borrow that money out of your mortgage at 6.19% (the best rate we could get last week out of everyone when we refinanced.
= $988 or $2.7 a day
could call that a connection fee and everyone would cry murder!
spread it out over 10kWh a day and its 27c/kWh
Now your cost to provide the same level of service as the grid to provide your own energy during that period is now
73c/kWh
Grid looks cheap to me as you’re getting 5c for it , you arent paying for any grid losses and getting it back later at 50c.
there are no economies of scale for grid scale batteries they cost similar as domestic scale.
the SEC juts part funded the Melton big battery to the tune of $245 Million,
thats $15Million they need to make to cover the interest there too right?
…..
Karl