NEWSFLASH – NSW Solar Bonus Scheme Permanently Closed

The NSW Government has announced the state’s solar feed-in tariff program, the Solar Bonus Scheme, is permanently closed to new applicants and the tariff rate will be significantly reduced for those solar households receiving or eligible for the original 60 cent tariff.

NSW Minister for Resources and Energy, Chris Hartcher, said customers eligible for the 60 cent tariff will see their tariff rate reduced to 40 cents from 1 July 2011 for the remainder of the Scheme. Those on the 20 cent tariff will see no change. The Government says it will be introducing legislation as soon as possible to implement this change.

The New South Wales’ government’s decision will likely help to significantly swell the number of people attending the “Solar’s Last Chance Rally” next week to protest the handling of the Solar Bonus Scheme. The rally had already scheduled prior to today’s announcement.

Organiser of the rally, Australian Solar Energy Society (AuSES) Chief Executive Officer, John Grimes said of the latest news, “The decision to roll back the feed-in tariff for existing solar customers is completely wrong. The public who invested in solar energy on the basis of a firm and legislated commitment from the NSW government now stand to be cheated out of those returns.”

“These people are not making windfall profits as has been claimed – for windfall profits you have to look to the big 3 electricity retailers who are consistently making more money selling more coal fired electricity,” said Mr. Grimes.

“The Australian Solar Energy Society is disappointed the NSW Government hasn’t acted immediately to introduce a 1 for 1 feed-in tariff ensuring NSW residents get paid at least the same rate for the electricity they produce as they buy from the grid. Under the current rate, clean solar power is subsidising highly polluting coal-fired power and that makes no sense. Big energy has won again.”

National solar solutions provider Energy Matters’ CEO, Jeremy Rich, expressed his disappointment with the decision and commented on the short term view and misinformation campaigns solar power has continually been a victim of.

“When our long term energy security is challenged by higher commodity prices can the big government/big business solution of over-dependence on undervalued coal and gas assets continue unchallenged? Solar has to be part of any sensible energy mix for our nation. With zero cost fuel – the Sun – solar provides certainty and protection.”

“Further, it needs to be remembered that electricity users are currently being asked to pay upfront for the renewable energy benefits (STCs) which will be created over the next 15 years in relation to solar panels. All other capital works, be it a wind farm or network upgrades, are paid for over decades, consequently it is very hard for the Australian public to make an apples with apples comparison in relation to the cost and value of solar panel generated electricity vis-à-vis fossil fuel generated electricity,” said Mr. Rich.

“Similarly with solar feed-in-tariffs remaining fixed, the most significant cost in real terms to electricity users is in the first year. The State or regulator could provide leadership by educating the market on the real cost of solar as a 40 year plus electricity generator, whilst also considering financial engineering support to ensure electricity users get the costs from solar electricity generation spread out over the long term and in line with the lifespan of the solar generator – the same way network upgrade costs are spread.”

“We need to ensure Australians have access to clear information, enabling easy apples with apples comparisons to be made, and consequently good decision making.”

In terms of the immediate future now the State Government’s decision has been made, Mr. Rich agrees a 1 for 1 net feed in tariff is critical.

“The New South Wales solar PV industry has approximately 5,400 solar jobs on the line. In the not too distant future, the state will reach the point where the price of installing solar panels is cheaper than buying regular grid electricity – what is known as grid parity. We need clear consistent policy to sustain us to that point in time.”

“The solar industry is not asking for more money. We are asking for a longer term sustainable policy and the NSW Government must act immediately to introduce a 1 for 1 feed-in tariff ensuring NSW residents get paid at least the same rate for the electricity they produce as they buy from the grid.”

Energy Matters announced earlier this week it will be a primary sponsor of next week’s “Solar’s Last Chance Rally“. Affected solar households, businesses, industry and all solar supporters are encouraged to attend.

Rally details:
11:30am Wednesday 18 May
Barnet Long Room: Customs House
31 Alfred Street
Circular Quay
Sydney