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Solar and storage boost? NSW households face 5c/kWh price rise

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The continuing surge in New South Wales wholesale electricity costs – and in other states for that matter – is likely to add even more incentive for households and business to turn to rooftop solar and battery storage.

rooftopZen

NSW baseload futures prices for 2018 have jumped another $10/MWh to $115/MWh in the last two weeks, meaning that a rooftop solar system is cheaper than the wholesale price of the coal-fired grid, let alone retail prices which are more than twice as high.

Analysts at Morgan Stanley say that if the wholesale price increase was to be fully captured by energy retailers, then the retail price would need to rise by around 5c/kWh, or about 20-25 per cent.

This scale of rise, shocking as it would be, is unlikely to happen because most retailers will have a rolling hedge book that will mitigate part of the cost increase.

Still, Morgan Stanley expects that retail prices will still have to increase around 10 per cent from July 1, which would add at least 2c/kWh on to energy costs, which are currently 21c/kWh to 24c/kWh, not including hefty network charges of up to $1.50/day.

This should be yet another incentive for NSW households to invest in rooftop solar. The state trails most other states on solar penetration, with around 15 per cent of homes, compared to nearly 30 per cent in Queensland and South Australia.

And the fact that NSW retailers offer such a small amount on solar exports (most at around 6c/8c/kWh, with a couple of outliers on 12c/kWh) this should increase the attraction of battery storage.

NSW is already seen as the best state for battery storage because of the recent expiry of premium feed-in tariffs.  

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  • Andy Saunders

    I wonder if retailers will increase their solar FiTs by 5c across the board as well?

    • john

      no

    • Joe

      They won’t do it voluntarily as paying the measly 6-8 cents they can make a profit on the ‘GreenPower’ that residential rooftops generate. We need to seriously look at the recent decision in Victoria where the FiT was increased to 11 cents and the justification for the increase. Not getting ‘fair value’ just incentivises solar home owners to go full steam ahead into home battery storage. Whhy give away your clean, green electricity for virtually nothing ?

    • Joe

      They won’t do it voluntarily as paying the measly 6-8 cents they can make a profit on the ‘GreenPower’ that residential rooftops generate. We need to seriously look at the recent decision in Victoria where the FiT was increased to 11 cents and the justification for the increase. Not getting ‘fair value’ just incentivises solar home owners to go full steam ahead into home battery storage. Whhy give away your clean, green electricity for virtually nothing ?

      • Greg Hudson

        We also need to discover why retailers charge more for power to a house with PV. My personal example (2 houses in same area, same retailer, same distributor): House with solar: 33c/kWh. Without: 19.71c/kWh. They are screwing us at both ends, Retail AND the FIT.

        • AllanO

          Change your retailer – the one you are with is fleecing you

        • Joe

          A case of two tiered pricing ? Personally I have not heard of this before but I am guessing with the number of people with rooftop solar and more and more going with rooftop solar, then The Retailers are going to find ways of boosting their revenue. If The Retailers adopt two tiered pricing then it will only drive more solar homes to go with home storage batteries. But I would like to think that there will be retailers that won’t go the low road with this two tiered pricing.

  • john

    Let us take price of power at 24 cents per kWh.
    Usage of house 25 KWh per day.
    That would be on the lower end perhaps 35 KWh would be more realistic.
    Buy a solar array of 5 KW to deliver at least 7000 plus KWh per year.
    Output of solar array will replace daytime usage and export the rest perhaps between 60% to 40% export.
    Ok average would be 6 KWh to buy or 16 that is on rough figures mind.

    • Ray Miller

      John when you use kilo.watt.hours the “k” is always lower case kWh.
      Having an energy efficiency strategy will bring the load down considerably over time. With more peak charges 4-8pm makes more sense to add some storage to use the excess to charge batteries during the day and displace as much as you can 4-8pm.
      We should be aiming for at least net zero energy houses.

      • john

        In simple facts put PV on your roof it will pay you.
        Being pedantic about kWh or Kwh or kWh is rubbish.
        Simple fact as I pointed out is put in PV use storage and anyone is dollars in front or would you prefer $US

        I notice you got your definition from wiki kWh

        • Asking people to use accurate units is not being pedantic. It’s important. The recent unnecessary arguments about battery prices are a good example of why.

          My personal favourite is when a journalist writes mW instead of MWh. If you don’t know the difference, don’t write about energy…

          Cheers.

          Dave P.

          • john

            Yes i am across that David
            i said Kilowatt Hours for peats sake I did not say kw read what i said.

          • Greg Hudson

            Isn’t peates spelt petes ?

          • john

            How about we just concentrate on the meaning 1 kilowatt hour is as it says.
            I know often there is dispute when talking about a battery it may be a 100 MW battery which means we do not know how many hours it can deliver the 100 MW so lets just chill perhaps.

          • juxx0r

            i think you mean kW

        • krypton

          Not so much with the k or K being correct, but I once was on a NZ Standards committee writing the standard for CNG. I let it pass for several meetings, until I realised that nobody else had picked it up. They had written mJ when it should have been MJ. Nine orders of magnitude out. They knew the size of a kg and m, but had no concept how big a joule was.

          A friend of mine regularly complains about broadcast news not getting it right. He was fined and later took the broadcasting authority to court when the TV said that a super-nova was 240 light years away, when it was actually 240 million light years. The authority said it was a trivial difference. I had suggested to him to pay the $50 fine, but only to the value of one millionth – 5 milli-cents.

          Too many people get muddled between kW and kWh. If we, who know what they are, don’t get it right, then how do you think the general public will cope?

          So it is best to stick to the standard way, which is lower case k. As the unit is named after a man then it is upper case W. So kWh.

          • Brian Tehan

            Seriously? I agree that too many people confuse power and energy but the capitalisation of k is irrelevant to that particular error.

          • john

            kwh what can be confused it is not kw or kh it is how many Kilowatts hours of power being used for peats sake.

    • OnionMan77

      wATTS a KelvinWatthour? and were can I get me some…

      • john

        kilowatt hours.
        Now there are several ways it is presented however it means the same value 1000 watts for 1 hour. or a thousand watt per hour.

        • krypton

          John, You are correct in your first statement, but not the second.
          A watt is a joule per sec, so to further bamboozle us, 1 kWh = 1000 Wh = 1000 joules x 1 hour / 1 sec = 3,600,000 joules = 3.6 MJ.

  • Rod

    Network charges of $1.50 per day!
    Reason enough there to oversize PV and get storage enough for a couple of days.

    Monitor usage and drill down to get your usage to a level where you can comfortably cut the cord. Might need a gen set to cover wet/cold weather.