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Victoria Coalition votes for solar energy to be paid less than coal

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Legislation to change the way solar households are compensated for their distributed energy generation has passed through the Victorian Parliament’s Lower House, despite the opposition Liberal Party voting against the first-of-its-kind solar pricing reform.

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The proposed amendments to the state’s solar tariff were introduced to Parliament on Wednesday, based on the findings of an Essential Services Commission report that concluded the current FiT design did not adequately reward the value of rooftop solar on a number of levels.

In what amounted to a small, but not insignificant win for Australian solar households, the ESC report recommended the tariff be adjusted from a minimum rate of around 5c/kWh now to an average of between 6.5c-7c/kWh, to factor in time of export, location of generator, and avoided greenhouse gas emissions.

With the support of government, this means that from next July, solar households in Victoria will be the first in Australia to receive a feed-in tariff that directly reflects a climate change value, and a time of use component – although the value of rooftop solar to the network still has not been factored in, but may not amount to much.

Support for the bill was not unanimous, however. As we foreshadowed yesterday – and as Liberal MP David Southwick made clear in various Tweets – the legislation failed to win the support of the Victorian Liberals.

Their decision to oppose the tariff rise means that they want solar power to be paid less than coal fired power – Victoria futures prices for 2017 are trading at 6.5c/kWh. The Coalition wanted the solar tariff stuck at around 5c/kWh.

Friends of the Earth described the Coalition vote as “a slap in the face” for the state’s solar homes.

“(Opposition leader) Matthew Guy’s decision to vote against a fair price for solar is out of step with the community’s vision for a renewable energy powered future,” said Leigh Ewbank, Friends of the Earth’s renewable energy spokesperson.

“Guy has disappointed the community by voting against solar power.”

But the Opposition’s position on coal vs renewables is not exactly a secret. Liberal energy spokesman David Southwick told the Herald Sun on Thursday that an increase to the state’s solar feed-in tariff was “pretty much a new environment tax that will be subsidising a very small proportion of the community at the expense of those without solar panels.

“This comes at a time when Victorians are threatened with higher electricity prices in anticipation of the Hazelwood power station closure,” he said.  

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  • lin

    I hope that the 75% of Victorians who want more action to reduce our CO2 emissions remember how the Libs voted on this when the next state election comes around.

  • Chris Fraser

    Ah the Victorian Libs such progressive thinkers. How can I believe they only served one term ?

    • howardpatr

      Guess they would have taken advice from Josh Frydenberg – there lies some explanation for their stupidity

  • Kenshō

    “pretty much a new environment tax that will be subsidising a very small proportion of the community at the expense of those without solar panels.”

    If the cost rise to the consumer is 0.5c/kWh out of 25c/kWh, the rise in usage charge is 2% for non-solar households.
    Solar households will be exporting at 6.5-7c/kWh and importing at 25c/kWh, so perhaps a minority may choose to downsize a planned investment in battery storage to smaller kWh.
    The main stakeholder effected is coal generators, with a 100% loss for every kWh solar households export to the grid. The loss to coal generators is a multiplier of how many solar households decide to export generously, compared to using a strategy of self consumption by choosing to install larger battery storage.

    • Ian

      No point throwing pearls before swine. If the old coalition dog vomits, no good thrashing him, it’s just his condition and nature, just quietly build him a kennel in the corner and let him pass away in his own time.

      • Kenshō

        Everyone is moving their awareness forward in the best way they know how. Each has their potential increasing along the way. Every day is new. Today NSW Coalition Planning Minister broke with party lines to support abolishment of negative gearing laws. That’s a humanitarian act of courage towards all Australians having home ownership more affordable. So no one can be judged based upon their current state or identity.

  • Ken Dyer

    Solar panels are fine for retrofitting, but they are fast becoming obsolete for new build houses. Elon Musk recently introduced PV tiles, but there is already a product, developed in Australia, that will revolutionise PV. It is called Tractile and has won Australian design awards (www.tractile.com.au). It can replace tile or iron in new build houses, and can be used for power generation and/or solar hot water.

    Coupled with a Zcell (xxx.zcell.com) battery, another Australian invention, the average suburban home will be its own power station. When chained together with aggregation technology, a coalition of homes will be able to export power to the wholesale grid, or share it amongst themselves.

    That technology is already here. Just as computers created the information age, so renewable energy will create the renewable energy age. There is no going back. Eventually the dinosaur politicians will eventually come to realise this, otherwise they will lose what little credibility they might still have.

  • Ian

    To trifle over the actual FiT is petty, considering the piffling amounts offered. To be really smart legislation should be negotiated and secured for suitable grid access for distributed solar and other energy sources trading.

    1. Why not ask for a cost analysis of grid transmission costs. ie what is the cost to transmit 1KWH from say Hazelwood to a household in Bendigo? Very much an average for the state. The FiT should be the daytime import tariff less the average transmission cost.

    2. In exchange for inequitable FiT of 5c/KWH negotiate for unlimited export access to the grid. ie no questions asked as to quantity, timing or generation source of exported electricity.

    3. Consider other aspects to a future grid-based electricity marketplace and again secure those mechanisms that can create such a marketplace in exchange for the low FiT. Such as instantaneous wholesale pricing or at least very short interval pricing.

  • Miles Harding

    A slap in the face for solar households maybe, but a good day for batteries.

    Soon, householders willbe easily able to voice their disappointment by sidestepping the dinosaurs.

  • neroden

    The COAL-ition has made its nature very clear.