Blowout sparks fears over solar schemes

Australian
Friday 29/10/2010 Page: 6

THE states are resisting pressure to radically overhaul their solar panel schemes after the NSW government slashed its program. Master Electricians Australia yesterday called for uniform solar feed-in tariffs, arguing that inconsistency between the states and sudden changes discouraged electrical businesses from installing solar power systems.

"Many businesses have spent a significant amount of time and taxpayers' money training their staff to install solar panels, and all that investment could be wasted if demand dries up as a result of sudden government decisions", said chief executive Malcolm Richards.

The call came as the solar industry reeled from the NSW government's announcement on Wednesday that it would slash its solar bonus scheme in response to a massive blowout. Distributors and installers said once the backlog of orders ran out staff cuts would be inevitable. The NSW scheme had paid 60¢/kWh for all power generated but will now pay 20¢/kWh, prompting warnings the solar industry was in jeopardy.

Energy Retailers Association of Australia executive director Cameron O'Reilly said if the states were going to continue to have the schemes, they should make them more consistent: "Stop the contest between the states and territories, get them to rethink this whole approach". NSW and the ACT have "gross" schemes that pay households for all electricity they produce, while the other states have "net" schemes that pay for surplus power exported to the grid. Victoria's scheme pays 60¢/kWh for electricity returned to the grid, Queensland's 44¢/kWh and Western Australia's 40¢/kWh.

The Council of Australian Governments agreed in November 2008 to a set of principles for feed-in tariffs in a bid to encourage national consistency. But Mr O'Reilly said there were questions as to whether such federal-state deals had much weight and that National Competition Policy style payments should be used to encourage the states to adhere to them.

"If we want to see any federal/state reform, we have to see financial incentives to realise them, particularly when they are politically contentious", he said.

Both Victoria and Queensland said yesterday there were no plans to review the tariff, with the Queensland government saying its scheme "gets the balance right" as a net scheme that only pays households for the surplus energy they feed back into the grid.