Seeing red over Rudd's green credentials

Newcastle Herald
Wednesday 11/6/2008 Page: 9

Means testing for rebates kills off our solar future, writes Vicki Brooke.

THE Federal Government's budget announcement that solar panel rebates would now be means tested to make the system "fairer" dealt a blow to Australians wanting to make a difference to climate change. It also killed off the fledgling solar energy industry in one neat stroke of the pen. This announcement casts doubts on the Federal Government's position in combating climate change.

How serious is the Government in reducing greenhouse gases when it makes it more difficult for people to go solar? Those with incomes of more than $100,000 are the people most able to afford solar systems, but the $12,000 price tag for one kilowatt of solar panels puts them beyond the reach of most households.

Professor Tim Flannery suggests that, rather than destroying the effectiveness of the scheme in an attempt to protect the less well-off, the Government could offer rebates, and deploy means-tested buy-back schemes, to assist those who can't afford solar panels. The irony is that the rebates are likely to run out anyway before the green loans kick in next year. The system has effectively cancelled itself and taken a whole industry with it.

According to Andrew McCarthy, from the Environment Shop in Melbourne, the balance of the solar rebate fund is now $45 million. This translates into 5625 solar systems, and over the past five months, rebate applications have been averaging about 900 a month.

There are no guarantees from the Government that any more money will be made available. The means test will also reverse the falling price trend for solar panels, according to Don Henry, the executive officer of the Australian Conservation Foundation. Since the budget announcement, the industry has experienced a huge downturn in business just when manufacturers were gearing up to mass production.

Without sufficient incentives there will be little competition and prices will remain unsustainably high compared to other countries. A recent report from the UK suggests a range of incentives, such as feed-in tariffs, loans and grants, is needed to stimulate the market for small-scale renewables - including solar, wind, biomass boilers, solar hot water and small-scale hydroelectric.

The Federal Government should focus on building up Australia's renewables generation capacity by scrapping the $100,000 means test and ploughing money into a longterm renewable energy rebate fund, which would embrace all renewable technologies including solar and wind electricity generation as well as solar hot water, with special assistance programs for low-income households.

Anxious Australians need reassurance that the Government is serious about addressing climate change. Countries such as Germany and Sweden are investing heavily in renewables and there is mounting pressure on governments worldwide to address this global issue.

Vicki Brooke is co-convener of Climate Action Newcastle.