Solar has power to lower electricity bill

www.dailyexaminer.com.au
19th June 2009

IF you're finding it hard keeping up with changes to government rebates for solar energy systems, you're not the only one. But here's an easy explanation for you. Firstly, the Federal Government's recent removal of the Solar for Homes and Communities Plan only affects power generation systems known as solar photovoltaic (PV) systems.

Solar hot water incentives remain unchanged, meaning people can pay as little as $60 plus installation (about $1500) for a solar hot water system. The government's new incentive scheme for solar PV systems is based on solar credits - a program which will not be means tested like the previous rebate scheme, and which will be open to the commercial sector.

Basically, in the solar credits program you only pay a%age of the cost of the system and the installer claims the outstanding amount from the government, with that amount dependent on how many RECs the system qualifies for. The government will pay those who install solar PV systems five times the value of the renewable energy certificates (REC) the system qualifies for (up to a 1.5 kW system). So a system that qualifies for 31 RECs will benefit for $6975 worth of credit (based on a $45 REC).

The homeowner may still have to outlay up to $7000 for a 1.5kW system, but several other schemes are there to help further. The Home Sustainability Assessment Scheme, which starts on July 1, offers a free 'green' inspection for any household in Australia and may allow access to a $10,000 interest-free 'green loan' for use on renewable energy solutions and water and energy-efficiency devices. The inspection may also recommend behavioural changes.

Northern Rivers Renewable Energy operator Trent Rogers is a certified 'green loan' assessor. He said he'd already been inundated by homeowners wanting to find out about the scheme. Mr Rogers, who supplies both solar hot water systems and solar PV systems, said there were many ways people could benefit from a combination of government incentive schemes. He said the NSW Government's proposed feed-in tariff Scheme would pay solar energy producers 60 cents per kW hour of energy produced.

The cost of energy on the current market is about 17 cents per kW hour. In the proposed feed-in tariff system, a house using 20kW hours of power per day but generates 6kW hours from its solar panels would receive a 20 cent credit per day from its electricity provider.

"If a household could cut their consumption down to 15kW hours per day, which is very achievable, their financial benefit is even greater," Mr Rogers said. Money saved and earned through a solar PV system could be used to help repay the $10,000 green loan, Mr Rogers said. "But it's not just about money. A house with a 1.5kW grid connect system will save 78 tonnes of greenhouse gas emissions - 2600 kilograms per year. "Also there is no doubt the price of electricity will rise significantly in the future and people should take action to avoid being caught out."

Murray Kirk, from The Solar Shop in South Grafton, said awareness about solar energy was on the rise because of the incentives and general media attention. "The weather in the Clarence Valley is beautiful for solar," Mr Kirk said. Mr Rogers agreed. "This area is perfectly placed to take advantage of the many incentives on offer. We have plenty of sunshine and people are highly aware of sustainability issues."

What does it mean?

• REC - renewable energy certificate: A form of currency created by the Federal Government based on how much renewable energy your system produces. Eg. A 250-litre solar hot water system is awarded an average of 30 RECs ($1350 at today's rate). RECs are currently valued at about $45 each but vary according to market demand. They can be traded like shares.
• Solar photovoltaic (PV) system: A power-generating solar panel system which usually connects to the main electricity grid. The system produces power for the household's use with the excess being sold back to electricity suppliers.
• Solar hot water systems: There are two main types, flat plate and evacuated tube collector. The latter is more expensive but is said to be more efficient.
• Solar Credit: Multiplies the value of the REC by five ($225 per solar credit based on today's REC value of $45). Therefore a 1.5kw grid connect system which qualifies for 31 RECs will make a solar credit value $6975 (based on a $45 REC).
• Home Sustainability Assessment Scheme: Offered to all Australian households from July 1. Involves an assessment of water and energy efficiency in the home plus solar energy solutions. Households may qualify for up to $10,000 interest-free loans (over four years) to spend on solutions.
• Feed-in tariff Scheme: Proposed by the NSW Government - will pay up to 60 cents per kW hour of solar electricity generated.
• The average house uses 15 to 25 kW hours of electricity per day.
• A 1.5 kW PV system will generate 6 kW of electricity per day on average.