CEC hits out at gross tariff suggestions

20th Sep 2012

The Queensland Competition Authority (QCA) has been slammed for the second time in just a few days after suggesting a gross feed-in-tariff (FIT) system for the state.

Earlier in the week, former editor of Climate Spectator Giles Parkinson derided the idea in an article for Reneweconomy.com.au, claiming it was merely a way for utilities companies to hold on to their profits at the expense of consumers.

And now the Clean Energy Council is jumping on the bandwagon, stating that gross FITs would disproportionately affect Queensland's households.

The QCA made reference to gross FITs in a review regarding potential tariff structures in the state, with the organisation saying it was keen to find a "fair and reasonable" solution.

Under this form of tariff, people with solar PV systems must sell all of the electricity they produce to the grid for a standard rebate, before buying it back at retail prices.

However, in Queensland this would mean homeowners would receive eight cents per kilowatt hour of energy they sold to utilities operators, while having to splash out between 17 and 35 cents to repurchase it!

Russell Marsh, CEC policy director, said the QCA's claims of looking for an equitable solution for tariffs are anything but fair.

"What the Queensland Competition Authority has proposed is the equivalent of telling people they can't just use the lemons growing on the lemon tree in their backyard – they have to sell the produce to a wholesaler for next to nothing and then buy the lemons back at a premium from the supermarket," he noted.

The state's current FIT system (a 'net' scheme) operates slightly differently; rather than sending all electricity produced to the grid, solar PV owners use as much energy as they need from what they generate before selling back just the excess.

This enables households to minimise the amount of power they require from the grid, creating massive savings, Marsh continued.

Introducing a gross FIT would be an "unfair" proposal, he said, which could also prevent people from pursuing energy efficiency measures around the home.

"Installing rooftop solar panels is one of the best ways households can save money on their electricity bills," Russell concluded. "Changing to a gross scheme now would change all of that."

However, a gross FIT may not be bad for all residents. Queensland's previous FIT offered 44 cents per kilowatt hour, with anyone signed up to the scheme benefiting from this rate until 2018.

Posted by Mike Peacock

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