{"id":19841,"date":"2018-03-15T14:10:05","date_gmt":"2018-03-15T03:40:05","guid":{"rendered":"https:\/\/www.solarquotes.com.au\/blog\/?p=19841"},"modified":"2021-02-24T12:54:56","modified_gmt":"2021-02-24T02:24:56","slug":"small-scale-technology-percentage","status":"publish","type":"post","link":"https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/","title":{"rendered":"Tony Abbott And Craig Kelly Want Frydenberg To Fiddle With His Small-scale Knob"},"content":{"rendered":"<div id=\"attachment_20027\" style=\"width: 1210px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" aria-describedby=\"caption-attachment-20027\" class=\"wp-image-20027 size-full\" src=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/stp-knob.jpg\" alt=\"\" width=\"1200\" height=\"800\" srcset=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/stp-knob.jpg 1200w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/stp-knob-300x200.jpg 300w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/stp-knob-768x512.jpg 768w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/stp-knob-1024x683.jpg 1024w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><p id=\"caption-attachment-20027\" class=\"wp-caption-text\">Tony Abbott And Craig Kelly Want Frydenberg To Adjust The Small-scale Technology Percentage<\/p><\/div>\n<p>Tony Abbott recently <a href=\"https:\/\/www.solarquotes.com.au\/blog\/abbott-renewables-subsidies-mb0501\/\">made a comment<\/a> about the <a href=\"https:\/\/www.solarquotes.com.au\/glossary.html#stc\">STCs<\/a> that reduce the cost of rooftop solar to households and are commonly called the &#8220;<a href=\"https:\/\/www.solarquotes.com.au\/panels\/rebate\/\">solar rebate<\/a>&#8220;<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-1' id='enref-19841-1' onclick='return hhEndnotes_show(19841)'>1<\/a><\/sup>.\u00a0 Guess what he wants to do with them?\u00a0 Do you need a hint?\u00a0 Tell you what, I&#8217;ll make it easy for you and put it in the form of a multiple choice question.<!--more--><\/p>\n<blockquote><p>Tony Abbott wants to:<\/p>\n<p><strong>(a.)<\/strong>\u00a0 Increase the amount of STCs to increase rooftop solar power installations.<\/p>\n<p><strong>(b.)<\/strong>\u00a0 Increase the amount of STCs and give everyone a pony.<\/p>\n<p><strong>(c.)<\/strong>\u00a0 Do nothing and allow STCs to continue to be <a href=\"https:\/\/www.solarquotes.com.au\/blog\/solar-panel-rebate-phased-1st-january-2017\/\">gradually phased out<\/a>.<\/p>\n<p><strong>(d.)<\/strong>\u00a0 Eliminate STCs.<\/p><\/blockquote>\n<p>What?\u00a0 You chose the last option?\u00a0 My, what a low and accurate opinion you have of him.<\/p>\n<div id=\"attachment_19979\" style=\"width: 835px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" aria-describedby=\"caption-attachment-19979\" class=\"wp-image-19979 size-full\" src=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/noabbotponyforyou.jpg\" alt=\"No Pony For You!\" width=\"825\" height=\"464\" srcset=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/noabbotponyforyou.jpg 825w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/noabbotponyforyou-300x169.jpg 300w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/03\/noabbotponyforyou-768x432.jpg 768w\" sizes=\"(max-width: 825px) 100vw, 825px\" \/><p id=\"caption-attachment-19979\" class=\"wp-caption-text\">What you won&#8217;t be getting from Tony Abbott.<\/p><\/div>\n<p>I have specifically focused on STCs, but what Abbott really wants to do is end all subsidies for renewable energy.\u00a0 So not only rooftop solar power but also solar farms, wind farms, small and large-scale hydroelectricity, and bargearse power plants.\u00a0 I mean <a href=\"https:\/\/en.wikipedia.org\/wiki\/Bagasse\" target=\"_blank\" rel=\"noopener\">bagasse<\/a> power plants that <a href=\"https:\/\/www.wilmarsugarmills.com.au\/about-us\/cogeneration\" target=\"_blank\" rel=\"noopener\">burn waste<\/a> from Queensland&#8217;s sugar cane mills.<\/p>\n<div class=\"youtube-wrapper\"><iframe title=\"Bargearse - Introduction\" width=\"500\" height=\"375\" src=\"https:\/\/www.youtube.com\/embed\/hCdi08dAVGU?start=26&#038;feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/div>\n<p>This latest round of renewables bashing was brought about by Liberal MP Craig Kelly who is not as famous as Abbott but is every bit as fabulous.\u00a0 Kelly recently <a href=\"https:\/\/www.solarquotes.com.au\/blog\/kelly-solar-subsidy-mb0498\/\">called for an end to renewable subsidies<\/a> and Tony Abbott just had to chirp up and give them a bashing as well like the natural born leader he is.<\/p>\n<p>I don&#8217;t know why Kelly is so against renewable energy, but he his the only Member of Parliament with a nuclear reactor in his seat.\u00a0 Personally I would have thought having a nuclear reactor lodged up your electorate might turn you off the idea of nuclear power, but he&#8217;s actually in favor of it.\u00a0 Just one year ago he said:<\/p>\n<blockquote><p>&#8220;If we are fair dinkum and say we need to cut CO2 emissions, we have to look at nuclear. The problem is the approval process would take a decade and it would have to be bipartisan&#8221;.<\/p><\/blockquote>\n<p>Or maybe he&#8217;s not in favor of it and is just setting up a false dichotomy<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-2' id='enref-19841-2' onclick='return hhEndnotes_show(19841)'>2<\/a><\/sup>.\u00a0 That&#8217;s the sort of tricky things politicians get up to, you know.\u00a0 In Canberra you can go for days without coming across a true dichotomy.<\/p>\n<p>I find it hard to believe he is actually in favor of nuclear power as he should know better than any MP that the <a href=\"http:\/\/www.ansto.gov.au\/AboutANSTO\/OPAL\/\" target=\"_blank\" rel=\"noopener\">OPAL reactor<\/a> we bought from Argentina<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-3' id='enref-19841-3' onclick='return hhEndnotes_show(19841)'>3<\/a><\/sup> was kind of pricey at $400 million and they&#8217;re not cheap to run.\u00a0 After all, the Australian Nuclear Science and Technology Organisation (<a href=\"https:\/\/en.wikipedia.org\/wiki\/Australian_Nuclear_Science_and_Technology_Organisation\" target=\"_blank\" rel=\"noopener\">ANSTO<\/a>) has an annual budget of around $150 million dollars<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-4' id='enref-19841-4' onclick='return hhEndnotes_show(19841)'>4<\/a><\/sup>.\u00a0 That&#8217;s about $16 per Australian household per year.\u00a0 I&#8217;m not suggesting that ANSTO doesn&#8217;t do useful things.\u00a0 They save lives.\u00a0 But they&#8217;re not exactly helping to save the planet like <a href=\"https:\/\/www.solarquotes.com.au\/solar101.html\">rooftop solar<\/a> does.<\/p>\n<h2>STCs Are Not A Cost But A Transfer<\/h2>\n<p>The first thing Kelly and Abbott are wrong about is saying that STCs are a cost when they are actually a transfer.<\/p>\n<p>If you want nuclear medicine then that costs money.\u00a0 You have to pay someone to shovel uranium into the reactor, you have to pay the wages of the person who whips the mutants so they turn the wheel to raise the control rods, and you have to pay for Aerogard so you won&#8217;t get any radioactive spider bites<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-5' id='enref-19841-5' onclick='return hhEndnotes_show(19841)'>5<\/a><\/sup>.\u00a0 The money spent pays for the effort required to make the nuclear medicine so it&#8217;s a real cost.\u00a0 If you want more effort you need more money.<\/p>\n<p>But the STCs received for installing rooftop solar are a transfer.\u00a0 Money is taken from everyone who buys grid electricity and is given to people who install rooftop solar.\u00a0 Almost everyone uses their STCs immediately to lower the cost of their rooftop solar systems (when you get a quote for solar it will assume this is what you are doing) but this is not necessary.\u00a0 You can take your STCs, cash them in, and buy an Xbox if you like.<\/p>\n<p>Now you might say the STCs are actually paying for a good part of the effort that went into installing the rooftop solar and making the hardware it is composed of.\u00a0 And that is a reasonable thing to say.\u00a0 But in this case the effort has gone into giving the homeowner cheaper electricity for however many years the system lasts.\u00a0 So it&#8217;s still a situation where money is taken from some people and given to others who up with more money as a result.<\/p>\n<p>So STCs are not a cost and if you did want to work out the average cost to household, you&#8217;d have to work out how much STCs raise electricity bills by on average and then subtract how much they lower electricity bills by on average.<\/p>\n<p>Kelly and Abbott are still welcome to claim that this transfer isn&#8217;t fair if they want, but they are wrong to only look at the increase in average electricity bills and call that a cost<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-6' id='enref-19841-6' onclick='return hhEndnotes_show(19841)'>6<\/a><\/sup>.\u00a0 Also, because it&#8217;s a transfer doesn&#8217;t mean there are no losses.\u00a0 It is generally said there are always some dead weight losses from a transfer, but I shy away from absolutes like that for good reason.<\/p>\n<div class=\"youtube-wrapper\"><iframe title=\"&quot;Only a Sith deals in absolutes&quot; 1080p HD\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/kVu_yMEhUfM?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/div>\n<h2>Benefits Of STCs<\/h2>\n<p>Abbott and Kelly seem to believe there are no reasons for having STCs.\u00a0 But they have a number of benefits beyond lowering electricity bills for Australians who install rooftop solar:<\/p>\n<p><strong>Lower Wholesale Electricity Prices:\u00a0 <\/strong>Mainly by reducing demand for electricity during peak periods &#8212; or what were peak periods &#8212; electricity from rooftop solar helps keep wholesale prices down which reduces the cost of electricity for everyone including those without solar power systems.\u00a0 This is something that must\u00a0be considered if you want to work out the real &#8220;cost&#8221; of STCs to households.<\/p>\n<p><strong>Lower Costs Of Rooftop Solar:\u00a0 <\/strong>STCs have helped drive down the cost of rooftop solar power in this country, making it the most competitive in the world.<\/p>\n<p><strong>Improved Health And Climate Stability:\u00a0 <\/strong>By helping shut down coal power stations, rooftop solar is cutting pollution and preventing deaths and illness.\u00a0 By reducing greenhouse gas emissions it reduces the damage done to the climate we depend on for little things such as agriculture, our animal friends, and civilization.\u00a0 This is also something that should be considered in determining the &#8220;cost&#8221; of STCs.<\/p>\n<p>Abbott and friends, or at least, friend<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/#en-19841-7' id='enref-19841-7' onclick='return hhEndnotes_show(19841)'>7<\/a><\/sup>, never seem to mention these benefits.\u00a0 I&#8217;m not saying they have to believe these benefits exist.\u00a0 I&#8217;m just saying that\u00a0they shouldn&#8217;t ignore these issues when discussing scrapping renewable subsidies.\u00a0 In fact, I think they should proudly and clearly state what they believe.\u00a0 For example:<\/p>\n<p>&#8220;<em>Basi<\/em><em>cally every working climatologist in the world believes human greenhouse gas emissions are causing global warming, but despite my complete lack of training, I think I know better than all of them<\/em>.&#8221;<\/p>\n<p>And:<\/p>\n<p>&#8220;<em>I don&#8217;t think it is important to reduce coal pollution because I personally believe humanity&#8217;s medical knowledge is deeply flawed at the most fundamental level.\u00a0 Furthermore, I believe my untrained opinion on this matter trumps that of health professionals and pretty much everyone else&#8217;s opinion as well.<\/em>&#8221;<\/p>\n<h2>Kelly Wants To Adjust The Small-scale Technology Percentage<\/h2>\n<p>It appears that Kelly is putting pressure on the <span class=\"Y0NH2b CLPzrc\">Minister for the Environment and Energy, Josh Frydenberg, to adjust the <a href=\"http:\/\/www.cleanenergyregulator.gov.au\/RET\/Scheme-participants-and-industry\/the-small-scale-technology-percentage\" target=\"_blank\" rel=\"noopener\">Small-scale Technology Percentage<\/a>.\u00a0 I&#8217;m sure Tony Abbott wants this as well, provided he actually knows what it is.\u00a0 Also, I have been told there is an army of unnamed backbenchers who are also clamoring for this.\u00a0 So in other words, it&#8217;s just Kelly and Tony.\u00a0 They used to be able to depend on Cory Bernardi, but he doesn&#8217;t play well with others and left to form his own party so he could play with himself. \u00a0<\/span><\/p>\n<h2>What Is The Small-scale Technology Percentage?<\/h2>\n<p>The Minister for the Environment and Energy technically has the power to adjust the Small-scale Technology Percentage (STP) which is the number of STCs electricity retailers must\u00a0surrender.\u00a0 The idea is the percentage gets\u00a0set at a level that maintains rooftop solar power installations at a steady rate.\u00a0 So Frydenberg basically has a knob he can twist to control how much rooftop solar gets installed.<\/p>\n<div id=\"attachment_18990\" style=\"width: 1194px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" aria-describedby=\"caption-attachment-18990\" class=\"wp-image-18990 size-full\" src=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/02\/apvigraph.jpg\" alt=\"APVI Graph\" width=\"1184\" height=\"508\" srcset=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/02\/apvigraph.jpg 1184w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/02\/apvigraph-300x129.jpg 300w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/02\/apvigraph-768x330.jpg 768w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/02\/apvigraph-1024x439.jpg 1024w\" sizes=\"(max-width: 1184px) 100vw, 1184px\" \/><p id=\"caption-attachment-18990\" class=\"wp-caption-text\">This graph from the Australian Photovoltaic Institute shows total PV installations. As you can see, solar installations have been fairly steady since 2011.<\/p><\/div>\n<p>He also has the power to adjust the maximum price payable for STCs, so if he wanted to, Frydenberg, a man who has spent a lot of time promoting the building of <a href=\"https:\/\/www.theguardian.com\/australia-news\/2017\/aug\/13\/new-coal-plants-have-a-role-in-australias-energy-future-josh-frydenberg-says\" target=\"_blank\" rel=\"noopener\">new coal power stations<\/a>, could effectively end STCs or crash their value down to zero.<\/p>\n<h2>Why Frydenberg Probably Won&#8217;t Touch His Knob<\/h2>\n<p>It is very unlikely Frydenberg will do anything to affect STCs at the moment and for now he&#8217;ll set the Small-scale Technology Percentage \u00a0to maintain a steady rate of solar installations as usual.\u00a0 This is because increasing the <a href=\"https:\/\/www.solarquotes.com.au\/panels\/cost\/\">cost of rooftop solar<\/a> will be unpopular among voters and Ministerial powers are very rarely used in this way.<\/p>\n<h2>Ministerial Fiat Can Backfire<\/h2>\n<p>Legislation often has a clause or clauses written into it saying the relevant Minister can change or alter it or decide how it applies more or less at whim.\u00a0 This is a safety valve feature in case situations change, legislation becomes\u00a0confusing, or it ends up being abused.\u00a0 But these clauses are almost never used to change the clear intent of legislation, despite giving the power to do so.<\/p>\n<p>One reason is if the government sabotaged legislation they didn&#8217;t like, the same could happen to their legislation when they are in opposition.\u00a0 But I think the main reason is, if a Minister uses their powers in this way and for whatever reason it isn&#8217;t popular, then the Minister&#8217;s own party is likely to blame him or her, so the Minister will almost always want to play it safe.<\/p>\n<p>It is quite possible the only reason Kelly is calling on Frydenberg to fiddle with his knob is because he knows full well he won&#8217;t.\u00a0 Politicians can be devious like that.\u00a0 Just like people who aren&#8217;t politicians.<\/p>\n<h2>The Minister May Need To Touch His Or Her Knob In The Future<\/h2>\n<p>In just 10 months time\u00a0changing conditions may start to cause a situation where the Minister for the Environment and Energy may need to adjust the Small-scale Technology Percentage knob.<\/p>\n<p>The South Australian Government and\u00a0Tesla are planning to build a <a href=\"https:\/\/www.solarquotes.com.au\/blog\/sa-virtual-power-plant\/\">250 megawatt Virtual Power Plant<\/a> by installing solar panels and batteries in 50,000 or more homes.\u00a0 By July next year they intend to have completed their trials and will begin installing solar panels at an average of perhaps 80 megawatts a year.\u00a0 Some of these panels may go on the roofs of people who would have gotten solar power that year anyway, but presumably most won&#8217;t.<\/p>\n<p>Eighty megawatts would represent around 9% of all the rooftop solar installed in a typical year and, all else equal, this would be enough to push down STC prices.\u00a0 If virtual power plants catch on in other parts of Australia, which seems likely as batteries fall in price, then STC prices could potentially crash if the Small-scale Technology Percentage isn&#8217;t adjusted to compensate for the effect of Virtual Power Plants.<\/p>\n<p>While a Coalition Energy Minister is unlikely to take action that causes STCs to crash, they may\u00a0be happy to take no action and watch them crash.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Tony Abbott recently made a comment about the STCs that reduce the cost of rooftop solar to households and are commonly called the &#8220;solar rebate&#8220;1.\u00a0 Guess what he wants to do with them?\u00a0 Do you need a hint?\u00a0 Tell you what, I&#8217;ll make it easy for you and put it in the form of a [&hellip;]<\/p>\n","protected":false},"author":10,"featured_media":20027,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[54],"tags":[],"class_list":["post-19841","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-solar-policy","entry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.2 (Yoast SEO v27.2) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Will Frydenberg Adjust The Small-scale Technology Percentage?<\/title>\n<meta name=\"description\" content=\"Energy Minister Josh Frydenberg has the power to adjust the Small-scale Technology Percentage and control how much rooftop solar is installed\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Tony Abbott And Craig Kelly Want Frydenberg To Fiddle With His Small-scale Knob\" \/>\n<meta property=\"og:description\" content=\"Energy Minister Josh Frydenberg has the power to adjust the Small-scale Technology Percentage and control how much rooftop solar is installed\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.solarquotes.com.au\/blog\/small-scale-technology-percentage\/\" \/>\n<meta property=\"og:site_name\" content=\"SolarQuotes Blog\" \/>\n<meta property=\"article:publisher\" 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