Wednesday, 27 January 2010

Calls to lighten power cost load

Canberra Times
Tuesday 19/1/2010 Page: 4

The ACT Government is coming under increasing pressure to exempt low-income earners from the additional electricity costs stemming from the ACT Government's solar feed-in tariff scheme, introduced almost a year ago. The scheme requires electricity retailers such as ActewAGL to pay households with solar panels a premium rate for the electricity they generate, resulting in higher electricity costs for all other households so retailers recoup that money.

The premium payments - made at a rate of 50.05c per kW-hour the panels generate - are an incentive to increase the uptake of solar panels and for households to recoup the high costs of purchasing them, and result in other households paying an average of an additional $27 a year for electricity. Although ACT Environment Minister Simon Corbell has previously said the Government would adjust the energy concession available to low income earners to negate the increase, more than six months after electricity prices went up there is still no sign of a reprieve.

ACT Council of Social Service director Roslyn Dundas said the energy concession had barely increased in years - from $189 in 2004-05 to $195 in 2008-09, while the average electricity bill had increased by about $350 in the same period - and the additional costs associated with the feed-in tariff were putting even more financial pressure on low income earners. About 22,000 Canberra households claim all or part of this rebate yearly. "It's putting an extensive burden on households to stay warm and cool," she said.

In its submission to an ACT Independent Competition and Regulatory Commission issues paper on the scheme, the ACT Civil and Administrative Tribunal also questioned the fairness of the scheme and existing concessions, saying, "The feed-in tariff, in the form adopted by the ACT, is highly inequitable.., the scheme design provides significant financial benefits to the wealthy investors in FIT capacity and passes the cost equally to all consumers, including low-income earners who have no financial capacity to make such an investment."

ACT Opposition leader Zed Seselja and Greens environment spokesman Shane Rattenbury also called on Mr Corbell to urgently increase the concession. Mr Corbell was unavailable for comment yesterday but a spokesman said the concession was being reviewed by the ACT Department of the Environment, Climate Change, Energy and Water and the Department of Housing and Community Services as part of the feed-in tariff Stage Two discussion paper released last month, which relates to expanding the scheme to large solar generators. A decision on the rebate would be announced "later this year".

Mr Corbell has also been criticised for telling the commission that it should not take into consideration "advancing welfare or social considerations" which the commissioner Paul Baxter flagged he would raise in a submission to Mr Corbell on what the new premium price should be. After receiving the submission Mr Corbell will set the premium price to be paid to occupiers of households participating in the feed-in tariff scheme for 2010-11.

"If this Premium Price, fairly set upon economic grounds, impacts upon the financial situation of low income or disadvantaged households this is a separate issue which the Government has other avenues for addressing. The Premium Price is not a suitable vehicle for advancing welfare or other social considerations," Mr Corbell wrote to Mr Baxter last week. As it was Mr Corbell who determined the terms of reference for the commission's submission, Mr Baxter said he would no longer include social equity in his submission.