The new solar rebates are complex, but still generous.
In early June, the Federal Government pulled the plug on its astonishingly popular $8,000 rebate for household solar photovoltaic panels. The replacement scheme, Solar Credits, was finally passed through parliament in mid-August.
So what are the changes? The $100,000 means test has been scrapped. Solar Credits is open to all comers, including businesses and community groups, and also applies to holiday houses and investment properties.
The scheme offers cash back to consumers by way of extra or ‘phantom’ Renewable Energy Certificates (RECs), which householders can exchange for a discount with the solar-panel retailers (who then trade them on the REC market).
Until 2012, solar systems up to 1.5 kilowatts will qualify for five times more RECs than normal (the multiplier diminishes progressively until 2015). The value of RECs fluctuates, but at a high $50 price, a Melbourne household could receive up to $6650.
With this discount, Adrian Ferraretto, Managing Director of Solar Shop Australia, expects that a good quality, 1.5-kilowatt system will cost about $8000, supplied and installed.
Panel-owners will also benefit from the Victorian government’s ‘feed-in’ tariff for systems up to 5 kilowatts, to begin before the end of the year. Power retailers will credit panel-owners 60 cents per kilowatt-hour for any surplus energy they feed into the grid.
Mr Ferraretto estimates that with these incentives, a system will pay itself back within five to ten years. “Solar Credits is still a generous rebate by global standards, especially when combined with the generous feed-in tariffs. And panels have halved in price (from the manufacturers) over the last 12 months. When you take all of that into account, today is a great time to buy.”
Community organisation Ballarat Renewable Energy And Zero Emissions (BREAZE) isn’t so sanguine about the fine print of the federal and state measures. Under its bulk-buying program, the group has arranged the installation of around 350 solar systems in the last 18 months.
Executive officer Lisa Kendal says there’s now a moral catch for solar PV buyers who want to get their discount. Bizarrely, although the ‘phantom’ RECs don’t represent actual electricity production, they will be counted towards the Federal Government’s 20 per cent renewable energy target.
“The more people who access the scheme for micro generation units, the more it will take away from our actual total renewable energy generation,” she says.
BREAZE was similarly disappointed by the detail of the State Government’s feed-in tariff: firstly, because it counts net output (electricity surplus to use), rather than gross output (all electricity produced); and secondly, because it’s a credit system. “The energy retailer is required to clock up your credits, but if you don’t use them after 12 months, they expire,” Ms Kendal says. “It’s not a real financial incentive. There’s no cash payout.”
Even still, BREAZE remains committed to promoting solar panels for householders. “We need to support the uptake of as much renewable energy as quickly as possible,” Ms Kendal says. “There are so many benefits in putting a system on your roof.”