Tasmania slashes feed in tariff for rooftop solar

Tasmanian households that are planning to install solar panels should act fast. The Tasmanian Government has announced that it plans to scrap the current solar feed-in tariff rates for new participants, and will replace the current 1:1 tariff with an 8c/kWh export rate from the end of August.

The 12,500 households with solar installed currently receive the full retail price of 27c/kWh under the 1:1 scheme. That arrangement has been extended five years until January 1, 2019 – more than the anticipated three year extension.

The Tasmanian Government had planned to lower the tariff earlier but received large amounts of backlash from community and pressure from the Greens. It may also have taken the backlash to the recent WA government decision in mind.

However, from the end of August, new households will receive 8c/kWh – in line with most other Australian states. Another feed-in tariff rate will be determined by the Economic Regulator at the beginning of 2014, ahead of deregulation that will allow competitors to the incumbent retailer.

A 5.5kW solar PV system can generate up to $1600 a year in extra income at the current feed-in tariff rate in either Hobart or Launceston. Tasmania is one of the last states to have a generous feed-in tariff rates as most have already been scrapped; Queensland’s Solar Bonus Scheme went from 44c/kWh to 8c/kWh in July last year. WA and other states have made similar cuts.

The Government has states that solar providers are allowed to offer a tariff rate higher than 8c/kWh to attract customers but the difference must be paid by the provider – not Government. It says extending the current tariff will cost around $7 million a year.