Mixed Greens: SA backtracks on solar feed-in tariff

The Essential Services Commission of South Australia (ESCOSA) has backed out of plans to raise its solar feed-in tariff, deciding instead to leave it at its current rate of 9.8 cents per kWh. ECOSA had planned to increase the value of the state’s FiT Premium to 11.2 cents per kWh from July 1 2013, but says the decision to maintain the status quo reflected “the reduction in the value of wholesale electricity relative to the value that was forecast in early 2012.”

ESCOSA CEO Paul Kerin said it was important to ensure the FiT reflected the current value of energy, pointing out that if it allowed the value to rise to 11.2 cents/kWh, “energy retailers would be paying an amount higher than the value of that energy.” This, said Kerin, “may have resulted in retailers not competing for solar PV customers and/or recovering those additional costs from other consumers, placing upward pressure on energy prices to all customers.”

It means that new solar customers in South Australia will get 25.8c/kWh until the end of September, when the 16c/kWh contribution from the network operators ends. The homeowners will get only the mandated tariff from the retailers. South Australia already has the highest penetration of rooftop solar in the country. Ironically, it seems the latest move on the tariff stems from the reduce cost of wholesale power, a result generally attributed to the impact of growing wind and solar energy in the state.

In other news…

The ACT government has given final approval for Spanish company FRV to build a 20MW solar PV facility at Royalla, near Canberra. The approval was given by Simon Corbell, the Minister for the Environment and Sustainable Development, who said it would be the largest solar farm to be developed in Australia to date, and would have a significant public benefit.

There were some objections from local residents who complained about visual amenity, but Corbell said an independent visual impact assessment found the impact would be negligible for most houses in the area, and trees would be planted to reduce the impact for the rest. FRV will build the solar farm after winning the first round of the ACT government’s solar tender. The winners of the second round of at least 20MW will be announced later this month.

On the subject of auctions for medium sized solar plants, Greentech Media report that the Californian city of Palo Alto, in the heart of Silicon Valley, has approved 80MW of solar power purchase agreements – equivalent to 18 per cent of the city’s load – for just $US.0.069/kWh (6.9 cents). The projects include a 40MW plant proposed by Silverado Power, another 20MW plant by the same company and a 20MW plant proposed by Ridgeline Energy. All of the solar plants are sited on “distressed agricultural land.”

“Try building a new nuke or coal plant at that price,” Adam Browning, of Vote Solar, told Greentech Media. The projects still include the 30 per cent federal Investment Tax Credit. The ACT auction price was 18.6c/kWh, although this translates into around 15c/kWh if inflation is taken into account. Palo Alto The has a goal of 100 per cent carbon-free power from the utility, which it said will cost ratepayers an extra $3 (three) a year. The ACT is aiming for 90 per cent.