CEC slams FIT deregulation in SA

24th Jul 2013

Proposals to deregulate South Australia's feed-in tariffs have been slammed by the Clean Energy Council (CEC).

ESCoSA – the Essential Services Commission of South Australia – has suggested the move to remove restrictions on the market would help energy consumers.

How does deregulation affect FITs? It would mean electricity retailers are free to set their own solar rebate rates, with the idea that competition between distributors will benefit end users.

Does it work? Well, the CEC doesn't seem to think so and it may have good reason to hold this opinion.

According to the organisation, deregulation is already in effect in NSW and it is failing.

The CEC said: "The purpose of the regulation of FITs is to ensure that all customers that are small embedded renewable generators have access to an efficient and fair price for exported electricity.

"That is, prices that reflect the economic value of those electricity exports, without cross subsidies between those electricity customers that generate electricity and those that do not."

However, of the 14 electricity retailers in NSW, eight have decided not to offer a solar FIT at all.

This is despite the Independent Pricing and Regulatory Tribunal (IPART) putting forward guidelines suggesting boundaries of between 7.7 and 12.9 cents per kilowatt of all energy exported back to the grid by solar power system owners.

Of the remaining six energy distributors, five offer a FIT scheme that is either at 7.7 cents or below.

Only one organisation provides customers with a solar rebate that is above the lowest boundary proposed by IPART.

"[We call] on the South Australian government to continue to offer the same level of consumer protection for solar customers that is available in South Australia and other states – by mandating a minimum legal feed-in tariff payment," the CEC stated.

Aside from slamming suggestions of deregulation, the organisation also called for more policies to be put forward to protect solar power system owners.

One of these is to make FITs technology neutral – which means offering households the same price for exported energy regardless of the technology they are using to generate it.

While this is not much of a factor now (as most people utilise solar PV on their rooftops), the regulation would become more important as advanced storage technologies hit the market.

The CEC also called for time-varying FITs, which provide off-peak, peak and critical peak payments, emphasising the importance of generating your own energy at certain times of the day.

Posted by Bob Dawson

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