“Great result” for wind and solar as huge fire levy threat to renewables is doused

The Victorian government has walked back changes to property tax laws that threatened to hobble renewables growth in the state by adding millions of dollars a year in extra running costs to solar, wind and battery projects through bloated fire levies.

The Clean Energy Investment Group last week warned that proposed changes to the Fire Services Property Levy would see the value of renewable energy infrastructure assets included in the calculation of the levy, which is charged to land owners and used to fund Victoria’s fire and emergency services.

The CEIG said the change to the rules around the levy risked resulting in the “unintended consequence” of hitting renewables projects with a 20-fold increase in annual project costs.

The industry’s concerns appear to have been heard, however, with the Victorian Treasurer Tim Pallas this week announcing further amendments to classify wind and solar projects as “public benefit” and not added to the overall value of the land, which is the usual base for calculating the Fire Service Levy.

Additionally, the Clean Energy Council says batteries will become eligible for the Payment in Lieu of Rates scheme, so that changes to Capital Improved Value do not “astronomically increase” council rates.

“This is a great result,” The CEC said on LinkedIn on Wednesday.

“The amendments announced by the Treasurer today are an important outcome for renewable energy in Victoria,” said Nicholas Aberle, policy director of energy generation and storage at the CEC.

“These amendments represent a massive reduction of financial liabilities when compared to what was originally proposed, which would have increased state taxes by a factor of 20 or more.

“The inclusion of renewable energy projects in the ‘public benefit’ classification provides certainty for future investment.

“The renewable energy industry is committed to paying a fair share. Indeed, projects already pay significant amounts under the Fire Services Levy and many also contribute directly to their local CFA through benefit schemes,” Aberle said.

“We thank the Victorian government for working with the CEC and our members to ensure the industry continues to make a fair and proportionate contribution.”