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Household solar “safe” as Abbott takes aim at large scale renewables

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So much for ditching the controversial and discredited Warburton Review of the Renewable Energy Target.

The Abbott government has confirmed that its opening position in talks with the Labor Party is for a “real” 20 per cent target, meaning that the amount of large scale renewable energy being built in Australia over the next 5 years could be cut by two thirds from the current target.

This was one of the key recommendations of the Warburton Review, which made the recommendation despite finding that the cost to consumers would be far less if it left the target at the current level of 41,000GWh by 2020, or made it a 30 per cent target by 2030.

The Abbott government had suggested that it had ditched the recommendations of the Warburton Review, but it has clearly done no such thing. Industry minister Ian Macfarlane, in comments to the media after a speech in Canberra, has, however, responded to the “Save Solar” campaign that targeted the marginal electorates by declaring there will be no changes to household solar.

wind and solar

One of these technologies is energy-non-grata in Australia.

That means that the upfront subsidy in the form of certificates will still be available for systems under 10kW. There is uncertainty, however, whether commercial-scale solar – from 10kW to 100kW – will continue to receive those certificates. These size systems may be transferred to the large scale scheme.

As RenewEconomy highlighted last week, the Abbott government’s decision making appears to be guided by its hatred of wind energy – the biggest victim if the 41,000GWh target is reduced to something like 26,000GWh, and if commercial-scale solar is allowed to compete in the same market.

The large scale renewable energy industry has said that such a target would be disastrous. Macfarlane has even endorsed the Warburton Review’s controversial suggestion that renewables should not be allowed to account for more than 50 per cent of new demand.

The solar industry, however, is satisfied that it has at least been able to protect the household solar market, which accounts for around 700MW of installations a year. About 15,000 Australian households add rooftop solar each month, despite the disappearance of state-based feed in tariffs.

Australian Solar Council CEO John Grimes said the Save Solar campaign had forced the Abbott Government to change its position dramatically. (The Warburton Review had recommended the closure of the household scheme, even as one of its senior panel members availed himself of the scheme to install a new system on one of his properties this month).

“The solar industry should give itself a real pat on the back for the strength of its community Save Solar campaign to date, but much more work needs to be done,”  Grimes said in a statement.

“Whilst the spectre of the extreme Warburton Review looms large over the Government’s thinking, the Government has simply failed to make the case for cutting the Renewable Energy Target.

“The so-called “real 20%” would effectively mean a 60% cut in the Renewable Energy Target and would kill large-scale solar in its tracks.

“The debate should not be about how much we should cut support for solar and the Renewable Energy Target. The debate must be about how much we expand our use of solar and achieve 50% renewable energy by 2030. Australians want more solar, not less.”

Still, Labor appeared to be holding steady on its target, with leader Bill Shorten telling journalists that the 20 per cent target was a “fraud” target rather than a “real” target. Labor has been prepared, however, to give ground on exemptions to large electricity users, such as the aluminium sector, and a possible deferral of the target to 2022.

The negotiations between the Abbott government and Labor were due to start at 3.30pm today in Canberra. Involved in the talks with were Treasurer Joe Hockey, who hates wind farms, Macfarlane, who prefers nuclear, and who was responsible for bringing the previous renewable energy target, the MRET, to a premature end a decade ago, and Environment Minister Greg hunt, who says people who don’t like coal-fired generation are “against electricity.”

On the Labor side are Treasury spokesman Chris Bowen, environment spokesman Mark Butler, and energy spokesman Gary Gray, who once said that he, Macfarlane, and former Energy Minister Martin Ferguson, who also did not like renewables, were like “three peas in a pod” – so the Abbott team may gain some sympathy there.

Australian Greens Leader Christine Milne says the Abbott government position should be rejected by the Labor party.

“There is absolutely no reason, and no excuse, for weakening the Renewable Energy Target. The Labor Party must stand firm and reject this deal outright,” said Senator Milne.

“By accepting Dick Warburton’s ‘real 20%’ target and half of any new growth recommendations, the Abbott government has signed up toa discredited review that is based in a refusal to accept climate science.”

Andrew Bray, the National Coordinator of the Australian Wind Alliance, said the Warburton review to attack renewable energy is the basis for the government’s position.

“The government is seeking less renewable energy and that means higher power prices for all Australians. Australians want more renewables, not less. We want lower power prices and they only way to get there is through more solar and more wind power being put into the grid.”  

Pocket
  • Okay, I see what they’re doing. Can someone please explain why though?

    • Peter Campbell

      Because ‘axe the tax’ worked so well for them they want to repeat it.
      Also, they are not listening to reason; their gut feeling is that renewables can only ever operate at the margin. To think otherwise would be to accept that they have been wrong all their lives and those totally impractical greeny/hippy types might not have been wrong – a bridge too far for them.

    • Jo

      To protect their mates in the fossil fuel and power industry (those have the power). Can you remember that the Warburton Review talked about the threat of ‘redistribution of wealth’ ?

      This policy has always been visible: COALition

  • Beat Odermatt

    It seems that the Luddite faction of the coalition is ready to turn the clock back. Sadly, Labor may also be ready to make a compromise, as coal and power station unions
    provide a very wealthy and powerful lobby group. The NSW and
    Queensland Governments are keen to maintain and increase current
    subsidies to the coal mining industry and associated power stations.

    The suggestions to cut the RET is aimed to harm Tasmania, Victoria, SA, WA, ACT and the NT. We can hope that parliamentarians from these States and Territories are able to stand up and defend the RET.

    It is sad that the Greens have lost their environmental credentials due to their extreme views on many other issues. Australia may have to look at creating a strong
    non-political environmental environmental lobby group or start a
    middle-of-the road environmental party. Considering that over 90% of
    voters want more renewable energy, castration of the RET may be a
    very unwise thing to do for any party.

  • Rob G

    Abbott can want all he likes. His demanding a ‘real 20%’ target for large scale renewable energy is unlikely to happen.The problem is he just doesn’t have the numbers. All parties against him have stated repeatedly that they will not budge on the 41GW target. The fact that he thinks he is in a position to negotiate is laughable,

    It is also amusing that Abbott’s tiny brain finally figured out that attacking residential solar was a voting losing move, so backing down was the only realistic option. No doubt, those politicians in the ‘tight’ electorates came knocking on his door and said it was going to cost ’em their seats. A job well done by John Grimes and Co.

  • Matthew Dawes

    Classic divide and conquer. Appealing to voters self interest.

  • barrie harrop

    This whole RET thing will become a tad academic as solar home storage moves to a 4–5 year payback–only 2–3 years away there will be mass exodus from the grid in the millions of households –exciting times.

  • John P

    “Household solar is safe”.
    Why are we even talking about this?
    This appalling person gave a catagorical assurance back in 2013 that “there would be no changes to the RET”.
    Newspoll told us yesterday that there was 6% difference between the parties.
    Only 6%!
    On the evidence it should be closer to 60%!

  • Chris Fraser

    The idea that renewables should not be allowed to account for more than 50 per cent of new demand is protectionism at its best. From a simple, provincial, libertarian (not), tinkering, interfering government. And i always assumed RET was designed as an open market to provide access to renewable energy. Meanwhile vested interests still get $9 billion per year of our tax even if we don’t consume their contaminated product.

  • Alen T

    You would simply be a fool to still have any faith at all in LNP’s words, the small-scale scheme is not safe and will never be as long as this government continues to place ideology and lobbying efforts (by the likes of AGL, Energy Australia…etc) over the publics well-being and desire.

    I said it before and I’ll say it again, if Labor deviates from the 41,000 GWh target I will forever lose faith in Labor.

  • Michel Syna Rahme

    Judgment days for Labor!
    To fold would be the end of their ‘left’ support base! Not sure what chances they would have for re-election without them. Especially considering there is no justifiable reasoning to reduce the RET for commercial scale, and the polls relating to the RET suggest they have a case for tough negotiation (allowing these imbeciles to fold and save some face), if not total rejection!

  • john

    I think trying to AXE renewables for the householder is very difficult.
    Reason.
    5Kw system cost $8000 or less
    Output 8000 KwH or more or less in Victoria.
    home use 2000 value $700 @ 35c KwH
    export of 6000 value $360 @ 6c Kwh
    total value to householder $1060 that is 13%
    reduce home use to half that $350 and export of $420 hell it is still 9% return.
    It is patently clear that PV is a good idea from any angle now perhaps it should be taxed to stop the spread that is the only way good luck with that idea.
    Or get rid of the $3000 help ok do figures again; $770 and $11000 still 7%.
    It still beats bank interest.
    Taxed at 35% $270 net $500 outcomes 6% and no support 4%

    No where to go on this so any party who comes out saying PV does not work will be very shortly shown to be, well may I say just a little bit misguided.