Cut the spin on Victoria’s solar tariff chop

If you have never been to a traditional Australian woodchop, you should. Watching the big men annihilating an 8 inch log in seconds is breathtaking.

Although the reduction of the Victorian solar feed in tariff was not a surprise, the massive “kerrchuuunk” sound that these big cuts make always sends a shiver down the spine of the industry; and the smirk on of the Victorian Minister for Energy Michael O’Brien’s face made it all the more vindictive.

“When we stepped down the subsidies from 60 cents a kilowatt-hour last year, to 25 cents a kilowatt-hour this year, we actually saw demand increase by 33 per cent,” he claimed. Duh. That’s because everyone could see what was next and rushed in before the axes came out.

He even went as far as claiming ”the feed-in tariffs are not driving the growing popularity of solar energy.” Really? Really????

In this staggeringly ignorant-or-deceptive statement the Minister for Energy showed his true colours. Take a look at your own statistics, Minister O’Brien – and those of every other state back as far as history goes and look at what happens every time a subsidy is threatened or finishes. Sales plummet.

Yep, solar prices are falling. Yep, its getting more affordable. And yep, we’ll survive, but only after we got through the “valley of death” once again. I had previously been quite complimentary of the Victorian Government’s “measured” response to adjusting solar tariffs but this is weak-willed, ill conceived and a long, long way from a “fair and reasonable” price for solar.

Trying to claim some bizarre credit for increased solar sales as a result of previous cuts is so loaded with spin that the Minister for Energy would surely win a wood chop with the famous spin required to reef into the other side of the big 8 inch block.

Ironically, the Australian Bureau of Statistics only last week released new data showing that the majority of Victorians who take up solar are the most in need, often in regional areas who desperately need assistance with rising power bills.

According to Sydney’s University of Technology, the Australian electricity industry got around $1.8Billion in subsidies in 2006 in their 2008 report. The Victorian government’s failure to provide even $0.01c out of its own pocket is therefore a long way from equitable and puts the still emerging solar industry at a distinct disadvantage.

FWIW if each of Victoria’s 2.4 million electricity consumers were charged $0.50c a week to create a community funds pool for those who were prepared to put up their own cash to buy, own and operate a solar system, it would raise $67M p/a to pay for the scheme. Its really not that hard and the solar industry is equally deserving of support, if not more so.

No big surprise, but wholly disappointing – the Victorian Department of Primary Industry quietly changed its web page today to reflect the end of the Standard and Interim solar tariffs from around $0.25 c kWh to $0.08c kWh.

The changes take effect as of 31 December 2012. Application forms must be lodged with electricity retailers no later than 30 September 2012.

Nigel Morris is director of Solar Business Services