A Nasty Surprise Awaits Small Scale Solar This Wednesday?

The early end to the Solar Credits multiplier may not necessarily signal an end to the subsidy roller coaster the industry has battled for the last few years.

The early end to the Solar Credits multiplier may not necessarily signal an end to the subsidy roller coaster the industry has battled for the last few years.
  
The final report of the Review of Australia’s Renewable Energy Target will be released this Wednesday and the Small-scale Renewable Energy Scheme (SRES) will likely see some changes.
  
In the earlier Discussion paper, a suggestion was made to introduce a “Solar Divider“; whereby a megawatt hour of solar would be worth less than one megawatt hour of another renewable source. This would further erode the subsidy available to solar buyers.
  
According to the Australian Solar Council, research commissioned by the organisation and submitted to the Review shows this approach would be unworkable and it is confident the Solar Divider idea will be dropped.
  
However,  the Solar Council says “the CCA is likely to recommend the phase out of the Small-scale Renewable Energy Scheme (SRES), by reducing the deeming period of 15 years from 2015.”
  
The deeming period is crucial in determining the level of subsidy for solar power systems. Currently, one Renewable Energy Certificate (REC/STC) is issued for each megawatt-hour of electricity generation a system will produce over fifteen years. If the deeming period is reduced, so will the number of certificates issued and subsequently, subsidy.
   
The recommendation, which the Australian Solar Council claims is being supported by another major Australian renewable energy industry association, would see the deeming period reduce each year until there is no deeming by 2030.
   
That such an important element of Australia’s renewable energy future may continue to be treated as a poor cousin will not only be a slap in the face to the industry and to Australian households, but the history of small scale solar support in this nation has taught us a very important lesson – one that the Australia Solar Council has raised:
   
“We know what happens if governments have the option to fast track any phase out arrangements – they use them, and solar programs always get cut short,” says a statement from the body. A very recent example is the Solar Credits multiplier being abolished 6 months early.
   
“Once you have a phase-out timeline in Regulations (which can be easily changed by the Minister of the day), we know politicians will jump in and change the dates, causing chaos for the solar industry. That’s been our shared experience for the last few years – the solarcoaster – and we shouldn’t expect anything different in the future.”
  

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