AEMC says rooftop solar export charge “optional” in bid to calm fears

The Australian Energy Market Commission has sought to allay concerns about a controversial proposal to allow network companies to introduce new charges to export solar to the grid, by saying they will be optional.

The offer of a compromise solution to the highly controversial “solar tax” was made during an online forum hosted by the AEMC, which sets the rules of the grid, this week. The optionality, however, appears to lie with the network owners, not the consumer.

Network companies in some parts of the grid say they have struggled to keep up with the huge volume of rooftop solar power that is being sent into the grid on very sunny days.

This has led to some network companies imposing limits on the amount of solar power that may be exported, and in some instances, some households have been prevented altogether from selling excess power into the grid.

A variety of proposed changes to the National Electricity Rules has been proposed by network company SA Power Networks and consumer advocacy groups the St Vincent de Paul Society Victoria, Total Environment Centre and Australian Council of Social Service.

Most centre around the ability of network companies to charge a fee on exports – possibly 2c/kWh or more – in constrained parts of the grid, ostensibly to pay for the grid upgrades said to be needed to support that amount of solar.

The AEMC held a consultation forum on the rules on Thursday, which brought together a range of industry stakeholders that included network companies and consumer advocacy groups, to discuss the likely impact of the new solar export charges.

During the forum, the AEMC stressed that the proposed new framework that would allow network companies to impose a charge on households exporting excess solar to the grid would be optional, and up to each individual network provider to design its service offering to consumers.

The AEMC also stressed that the new rules would likely work to ensure that more solar is able to be installed on Australian rooftops by ensuring that the ability to export excess power would be a core aspect of the services provided by network companies and that households would still be financially better off.

“Right now, there’s no requirement for your network service provider to allow you to export solar into the grid,” AEMC commissioner Michelle Shepherd told the forum. “And we think this is a shame.”

“It doesn’t really reflect what we’re seeing in the grid at the moment. There are no standards around the service you’ll receive from a network service provider if you have solar panels and we’re increasingly seeing customers being concerned and actually been stopped from exporting their energy into the grid.

“From a cost point of view, those who don’t have solar are currently subsidising customers that do have solar, and so we’ve thought about ways in which, while protecting customers that have solar, we’re also protecting customers that don’t, and can actually allocate costs in a more equitable and sensible way,” Shepherd added.

The proposal to charge households to export rooftop solar has attracted much controversy, with many pro-renewables advocates decrying the plan as a tax on solar power, and triggered a strong reaction from many existing owners of solar panels who have already sunk money into having a system installed.

The Victorian and Queensland governments have already ruled out any plans to impose such a charge on residents in those states.

However, the Australian Council of Social Service’s senior adviser on climate and energy, Kellie Caught, told the forum that the advocacy group overall supported the proposal, saying it would likely deliver a fairer framework for distributing the costs and benefits of increasing rooftop solar uptake.

“This initiative would reduce electricity bills for non-solar customers while maintaining significant financial benefits for those who are able to go solar, and some actually may be better off,” Caught told the forum.

“In fact, we are advocating for governments to support people in community housing, public housing and rentals to gets solar because, under this rule change, they will still be financially better off.”

Caught did admit there was concern the AEMC would hand too much power to network companies and the Australian Energy Regulator to make final decisions over the costs imposed on households, and that future export limits that may still be imposed on households.

Campaigning group Solar Citizens was less convinced, saying new tariffs could hamper the uptake of rooftop solar. Solar Citizens National Director Ellen Roberts also told the forum that the group feared consultation around solar export charges had been too focused on energy market incumbents.

“We want to not just to see the interests of existing solar households protected, but also, we need to see the growth of rooftop solar continue in Australia. It’s Australia’s clean energy success story,” Roberts told the forum.

“I think that that positive story can be lost a bit in this debate. It’s a very cheap source of energy, and particularly as we move towards decarbonising transport and industrial sectors.”

“I think rooftop solar does represent a threat to the very centralised institutions of the energy market. I think the days of a self-selected group of insiders making decisions about the market are probably over, simply because of the sheer number of generators that have a stake in how the system unfolds. I would suggest that it’s a consultation that has its serious flaws.”

The AEMC is expected to make a final determination on the new solar export charges before the end of June.