Consumer groups have joined a court fight against South Australia’s main utility over a proposal to slap increased network charges on households with rooftop solar. The consumer groups see it as a crucial line in the sand to stop other utilities from following suit, and slapping more charges on 1.4 million solar households across the country.
Consumer groups say they are joining the court action because the tariff is “discriminatory” and “unnecessary”, and will simply accelerate the move to solar and battery storage, and the move off the grid. This, they say, will create more problems for the network and their remaining customers.
“It will also cause long-term reputational damage to SAPN itself and is likely to accelerate the flight of solar and battery consumers from the grid, creating more of a cost burden for legacy grid-reliant consumers,” the Total Environment Centre says.
According to the TEC’s Mark Byrne, if SAPN succeeds in introducing the charge, then other network operators around the country could follow.
“We consider it likely that if SAPN is successful in its appeal, other networks around Australia will seek to introduce similarly discriminatory tariffs on solar customers, increasing their costs and slowing the introduction of a decentralised and renewable energy-based electricity system,” Byrne said.
“Our role in the case will be to clarify that the electricity rules do not allow networks to discriminate against solar owners under any circumstances.”
The TEC is acting with Solar Citizens, a solar consumer group with some 90,000 members, with funding from Energy Consumers Australia. Its application to join the court action was approved by the court on Monday.
It is one of a number of legal actions and protests over network costs currently taking place in Australia.
In NSW, the state-owned network operators are taking the AER to court over its refusal to accept all their spending plans in the next five years. The Public Interest Advisory Council is joined to that court action, arguing that the AER still allowed too much spending, and unnecessary costs will be passed on to consumers.
Networks around Australia are also under fire for tariff changes that the solar industry argues will discriminate against solar households.
This includes higher fixed charges in many states, including in Queensland where a household consuming just 1MWh of electricity a year will pay an average of 72c/kWh for electricity. That compares to the wholesale price of around 4c/kWh.
Critics say the mark-up – through network charges, retail margins and other margins – is simply not justified and not sustainable. The NSW networks are also considering a form of “solar tax”, imposing network charges on exports from rooftop solar back to the grid.
In the SAPN case, the TEC is supporting the AER position, although it says that the AER’s reasons for rejecting the SAPN solar charge in the first place was mistaken.
The AER rejected it on the basis that SAPN could not prove that solar households had a different profile from other customers. The TEC says SAPN should not be allowed to discriminate against any customer, regardless of load profile.
It cites a clause in the National Electricity Rules – Clause 6.18.4(3)(a) – which is intended to prevent discrimination between customers on the basis of micro-generation technology.
“In plain terms, the wording and intent of that clause are to prevent customers being treated differently in respect of the tariffs they are charged just because some have PV systems on their roofs,” the TEC argues.
“It is therefore irrelevant whether solar customers have a sufficiently different load profile to justify discriminating against them by creating a more expensive tariff for the same load profile.
“Our proposition is twofold: (1) if the test for the tariff class differentiation is based on whether a consumer has PV or not, that is unlawful discrimination; (2) if a customer on the “general tariff” who had the same load profile as a customer with PV would be treated more favourably than the customer with PV,then that is unlawful discrimination.
“Further, or in the alternative, even if the Court decides that such discrimination is lawful if PV and non-PV customers are found to have “sufficiently different” load profiles, we would argue that the load profiles of individual PV customers are so distinct that there is no justification for aggregating and averaging the load profiles of all PV and non-PV customers.
It uses this graph – from the APVI – showing the load profiles of 20 solar customers on the Ausgrid network on a particular day, which bear little relationship to SAPN’s graph averaging the daily load profiles of all its solar customers.
SAPN is also introducing “demand” charges that it says could reduce the uptake of rooftop solar by around half in coming years, although it could accelerate the uptake of battery storage, and even electric vehicles.
The TEC – and other groups – say they support the move to demand tariffs, but argues they should be properly structured. They prefer tariffs based on “critical peak use” – meaning tariffs should be structured according to network peaks, rather than individual consumer peaks, which may be at different times.
Solar Citizens national Director Claire O’Rourke said the SAPN move was an attempt by SAPN to “gouge” solar homeowners. “(They) are again trying to push through unfair fees onto the solar community by any means possible,” O’Rourke said.
South Australia has 190,000 solar households and some 570MW of rooftop solar capacity. Last week, the Australian Energy Market Operator said this could rise five-fold over the next two decades, meaning the rooftop solar could meet all the state’s demand on some days within a decade.
By 2034/35, along with large-scale renewables such as wind energy and solar PV, renewables could be providing the equivalent of all the state’s power needs.
41 responses to “Consumer groups join court fight against utility over solar charges”
lin
I wonder if the Cheung Kong Group of companies (which are the majority owners of SAPN) will be the first of many foreign multinationals lining up to sue taxpayers under the TPP or China FTA if their licence to gouge is in any way blocked. Good luck to the citizens of SA, and remember that 190,000 households is a lot of voters.
john
You can bet on that because the signing of a TPP allows an group of people to rule exactly as expected fine the government or company or individual.
No court of law just a kangaroo court.
john
As I have posted before the people who are in the middle of this are caught between an old situation and the new age of selling the network.
I do not blame the new owners of the network they purchased an asset under false understanding of the underlying situation.
So they are trying to use the old rules to get a result that is good for them however I think it was a governance fail on their part.
Beat Odermatt
If you buy an assets under false understanding then you are a very bad manager. SA Power Networks is a privatised sibling of former ETSA and only the most naive of people would have not know that changes in the electricity industry would happen. If an energy user is using less energy because he is using more energy efficient goods, is on holiday or is using solar panels, the cost to deliver energy does not change.
gawtech
Sorry Lin, I fail to see what voting has to do with this. The Liberal party are so pro china “free” trade, pro user pays, pro selling government assets, as to be completely useless as an alternative government. Despite their mistakes, Labor do at least do the right things for most of SA.
lin
My point is that if the Labor government capitulates to the power network owners at the expense of voters, they should expect a lot of voters to be looking at Independents and Greens as options to better represent their interests in the parliament.
Beat Odermatt
For your information the State Government of South Australian is run by Labor. Beside making great media statements about renewable energy we have not heard anything which would show that the current Government in SA actually cares about the rip off proposal by SA Power Networks.
Beat Odermatt
The proposed action of SA Power Networks are nothing more and nothing less than a anti-carbon tax. It is not in the public interest for a company to punish people for doing the right thing for the environment. I hope that the Government of South Australia and the Commonwealth Government take firm actions against this company. Similar to bank charges which were found by banned by ACCC , these charges have no justifications.
john
I do not see it in those terms it is a breakdown in the historical system which is just about 100 years out of date.
Beat Odermatt
What has changed? Trying to rip off people has been wrong 200 years ago and is still wrong.
john
This action by the Network Operator is exactly what I expect.
The supply of power is a service delivery obligation.
Other aspects of service obligation are.
Roads, transport, water, communication, health, public safety,
Yes I know ports, post, etc. the list is extensive.
Once any of these aspects of society is privatised the service delivery obligation is discarded this is detrimental to society.
If we wish to see a breakdown in service delivery then allow a fragmented delivery of any of the basic needs of a cohesive society.
I can absolutely understand the problem with the network owner they are not being paid for supplying a network to a particular group of people in this case some 190,000 households.
Why have we come to this point of a court case because we are working in an historical situation and have not moved on to the new realisation that a household can actually augment their needs and further more the needs of others, which the retailers gain, perhaps the Network Operator should look at the Retailers, who are profiting at their expense not the PV owners, who are helping the retailers by reducing their wholesale costs.
Maurice Oldis
not being paid to be connected??how do you work that out?Everybody pays to be connected solar or not.I am paying $1.45 per day to be connected-with solar!
Beat Odermatt
Yes, YOU are being punished for trying to do the right thing.
lin
If the network operator cannot keep the network running for the $500 dollars per year they charge each household to stay connected, on top of the profit they make from selling power, they are not competent to run the network.
Diego Matter
I would add, then the economics of the delivery of electricity for households have changed in favour of solar and solar plus storage.
Peter Campbell
Perhaps everybody with solar PV should switch off their inverters at the same time one hot summer afternoon, and see whether we are adding or subtracting from general costs.
john
Peter as you know a brown out would result and if not a huge spike in energy costs this is the reason that PV has saved those who did not buy them to have only a cost increase due to network expansion.
Peter Campbell
That is my point. What if we went on strike?
Maurice Oldis
its a great idea-and should be threatened then followed up!
Mark Shakeshaft
I’m laughing but only because it’s true, a nationwide PV “Earthhour” just occurring during a sunny/hot January day.
phred01
Great idea unfortunately it could backfire. The electricity providers could love it as they then could make a killing on prices. The turn off would need to be quite extensive were the network fails and the govn’t would have to step in to ensure supply. A slightly different approach would be to turn off & on so the network overloads in both extremes. this will make the network operators have a headache in surge management. If the network can be forced into a crash only then powers that be will be forced to take notice
Pedro
Suggest the 1st Friday in December where forecast is over 35 degrees…If the brown out happens everyone gets to go home early. Solar citizens could probably organize.
Steve Fuller
If the network operators get their way and reduce the incentive for solar owners to stay on the grid, defection will follow as batteries become affordable which they already are for early adopters.
Those remaining on the grid face spiraling price increases as the on-grid customer base shrinks.
The private network operators already hold a privileged position within the capitalist economy with regulated monopoly and guaranteed profits.
Governments will need to consider increasing regulation, rewriting the market rules or even nationalisation if the goals of transitioning to carbon free energy at a fair price are to be achieved.
MaxG
It is the very same government that sold us out in the first place!
Welcome to the free market 🙂
Beat Odermatt
I am sure senior management of Cheung Kong Group of companies will realise one day that their “managers” running SA Power Network will do a lot of harm to the image of the company. It will harm their future prospects to increase investment in Australia. Is SAPN like a tick on the tits of a bull?
Math Geurts
Don’t worry about solar “customers” moving off the grid! Pay if you want to stay, or leave if you want to be on your own!
john
Very true Math
In fact all you need to do atm is buy about 8 k of solar and perhaps 35 k of backup storage or less if you want to use a generator.
Work it out according to your needs.
Maurice Oldis
Every solar customer that exits the grid increases the load on those who stay-its a major shooting in the foot effort by the networks!
Math Geurts
You don’t have to do calculations for the networks. Pay or leave.
Diego Matter
You`re wrong.
The network is a common good and necessary for an economy to prosper. Therefore setting the networks up to fail is in nobody’s interest. As always the lower economic population will suffer the most if this would happen.
rick
My comment on the ongoing price increase of electricity is I am preparing to go off grid with a system to be built up over a period of about 2 months. This so that when the FIT is withdrawn (NSW 31.12.16) I will no longer contribute to the grid by feeding in my solar for which I would receive about $0.05 cents if at all as the energy retailers are not bound to pay for solar after this date. So my revenge will be not to prop up an ailing system. If everyone turned off their solar especially in SEP,OCT, NOV, DEC, JAN, FEB, MARCH, the electrical grid would fail. With me off gird I would not care. Eventually the GOVERNMENT and electricity retailers would have to provide a reasonable return for solar at $0.44 as is done in Germany and it is government legislated. Good luck with what is to come and think long and hard about turning off or off grid.
Hendo
I did not see this raised yet but there are those in the power industry that would have us pay a service charge even if we are not connected. If the wires pass your house, you pay for that service. There is a precedent: if a sewer passes by your home, you are “encouraged” to connect. If you do not, you still pay as if you were connected. Not so different with power is it? I don’t know if it would stand a legal challenge but it is still a nasty thought and enough to somewhat blight storage options.
Rurover
So can someone please explain why solar owners are apparently expected to pay a penalty rate for their supposed strain on the network, yet installers of heavy power consuming appliances such as air conditioners are NOT asked to pay the penalty?
Seems to my tiny mind that this is a blatant case of discrimination which clearly support the TEC’s contention that the SAPN case should be thrown out the court.
Beat Odermatt
Yes, it is all about making sure that a lot of gas and coal are burnt and that a lot of electricity is sold.
gawtech
So SAPN (formally ETSA) are billing Solar Generators for problems that are created upstream of the ETSA network (eg Electranet, big power stations). Given the intent is that supply charges go to SAPN/Electranet, and the per Kwh charges to the generators, why the hell does SAPN care if anyone uses less electricity ?
If houses in a street draw power from their neighbours on a hot day, then its a good thing for SAPN as their transformers are less likely to overheat.
Awful truth is SAPN are throwing a dummy spit at solar panel owners for putting the brakes on the gold plated network upgrades. ETSA never, ever should have been sold in the first place.
rick
As I said yesterday the best way to show the Energy Suppliers what ever name they hide behind is for everyone to turn their solar teed in OFF so that the enormity of what we solar Small producers provide to the various electrical networks across Australia. I will make my own although silent protest by turning off my solar when the FIT is turned off.(31.12.16) and go off grid, good luck the someone that tries to make me pay for a service I will no longer be using.
rick
Most solar systems are grid connect and without the grid to reference the inverter it will shut down due to the anti islanding software internal to the inverter and also legislated to allow an inverter to be connected to the grid. This software is there to protect the electricity workers who could be working on the electricity grid (for safety) now it is a necessary part. But back to the issue if many or most or all solar owners turned off their system it would leave the grid with a major sort fall in capacity. If this was a concerted protest then it would serve as a show of will to stand up for our selves. Give it some thought as any action has its costs ( not only monetary) and you may have a legal situation to deal with. I am not a legal person but if someone with legal background in this area would be appreciated if they would give their input on this side of the conversation as it could be interpreted as civil unrest, it would be hard to prove as my system would be off for over due maintenance. For may be along time.
Chris Fraser
One day when you get rubbish instead of a solar bonus try out the Selectronic GO series. You can combine it your anti-Islanding inverter. I suspect you can then become an island when the grid is off, and you can control exports at other times. (Disclaimer – I don’t get paid by Selectronic).
Ronald Brakels
On my last electricity bill here in Adelaide I paid 44.5 cents for each kilowatt-hour I used. The average household in my area without rooftop solar pays about 34 cents a kilowatt-hour. In other words I pay about 31% more per kilowatt-hour for grid electricity. Isn’t that enough? If they really need me to pay even more money I’m sure I could find some loose change if I went through the couch.
rick
Sorry to here you pay $0.44 for electricity, I pay $021.87 things must be hard under that scale of charges. I installed solar hot water Apricus ( round tube with fluid contained within separate to the hot water which flows through the manifold which is the run back down to the storage tank). This system is about 20% more efficient than the usually seen flat plate style of solar hot water collector. So I have not paid for hot water since it was installed. Happy a big yes. The supply company has been increasing their connection charges it has gone up by about 75% to be connected to their system, these sneaky charges are added to the bill and I am shore they think no one notices. What I have been reading lately is that supply companies what to add another charge for the fact that we solar citizens have the audacity to fit solar and then ask for a feed in tariff. Personally what we should be starting to advocate for is a reasonable FIT that would compensate us for spending our own money to install then run and maintain. Yes there are maintenance costs with solar. EG inverters last about 5 – 10 years then need replacing, solar panels need cleaning every 3 – 6 months in some areas( panels if they are quality ones then 15 -20 years with a drop off in out put after 10 – 15 years. So yes a solar system on going costs although reasonably low. I am currently receiving $0.60 cents FIT ( I got in early about 7 years ago) now the Liberals have done all they can to destroy solar as without it all you have is dirty filthy coal to burn with all its COSTS that go with it. Health is the main one along with pollution and acid rain in some areas. Please people start to do your own investigation for your self to become as knowledgeable as you can Go to your local MP and ask him to fight for a reasonable FIT. Take a look at Germany for example $0.44 cents government mandated ask a Liberal to do this they would have a heart attack. It is not in their scope of reality to help the average consumer. So I say make your self as self sufficient as you can. PS if you did not know the NSW FIT ends 31.12.16 then you go onto whatever your suppler wants to give you. $0.05 I have been told. Sorry I will not be giving it away for nothing. I expect to go off grid with no feed into the grid. My plan and will be is to leave the grid.
phred01
This smacks action by a monopoly be an anti competitive activity A3C should be looking into this
