Solar rush continues in Qld, as Newman plans asset sales

The rush of Queensland households towards rooftop solar – even with minimal subsidies and incentives – continues unabated with  another 3,687 new rooftop solarPV systems metered by Energex in the month of May, adding 16.2MW of solar capacity to the grid.

The uptake of rooftop solar is now the highest in the south-east of the state (the area managed by Energex) since the Queensland government slashed the feed in tariff from 44c/kWh to 8c/kWh in 2012.

Energy experts say it is being driven by the continued surge in electricity prices (it will rise 21 per cent in Queensland in 2014/15, thanks to rising gas and network costs), which are overwhelming any energy efficiency savings. The relatively high tariff of off-peak electricity (20c/kWh in the evening) is also encouraging maximum self consumption of rooftop solar output.

As this graph below shows, the green line is the number of new systems metered under the 8c/kWh tariff, while the red line shows the combination of that number, and those who have transferred from the 44c/kWh tariff – probably because they sold their house or expanded their system. They are represented by the blue line. So far 12,500 systems have come off the 44c/kWh tariff.

All this happens as the state government announces plans to sell its generation assets, and to bring in private investors to co-invest with the transmission and distribution companies.

The sale of generation assets will be interesting, as the likes of Stanwell Corp has blamed the impact of rooftop solar on its inability to generate a profit last financial year. CS Energy faces similar challenges.

The attraction of rooftop solar also poses interesting challenges for the network operators. Part of the challenge of solar is being addressed because commercial users are being encouraged to install “export limiters’ which means that they will consume the solar output on site when they can, and won’t flood the grid on holidays, for instance.

But the popularity of solar also means that network operators need to think differently about network upgrades, looking to battery storage and distributed generation rather than more poles and wires. For that reason, the decision by the state government may open the way for a new breed of partner to enter the business – battery suppliers for instance. If that is the plan, then that is a potentially very good development.

This graph below highlights the amount of rooftop solar capacity installed under the 8c/kWh tariff was introduced. It is now more than 181MW. Incidentally, that tariff reduces to zero (or a voluntary payment by the retailer) next month, so it will be interesting to see what happens then.

The last graph shows the combined solar PV capacity in Queensland, which is now at 1.157GW as at the end of April. That makes it the fourth biggest generator in the state.