Rumours have been floating around the Australian solar industry recently that the $8,000 solar power rebate may end soon, some saying as early as the end of this month.
These rumours were given a little more credibility recently when the Climate Change Minister, Penny Wong, refused to guarantee that the rebate has a solid future and wouldn’t even speculate on the continuation of the rebates in their current form for another 3 months.
For the Australian solar industry and consumers alike, this is an unsettling situation, particularly given current world economic conditions. Solar power is now big business in Australia and additionally, the uptake of grid connect and off grid solar power systems is helping the government move closer towards their renewable energy target of 20% by 2020.
The refusal by Penny Wong leaves everyone with an interest in solar power in limbo and is creating a rush for the rebate – stretching some smaller providers to their limits. Currently, 1000 applications for the $8,000 solar power rebate are lodged each week, but the Government only budgeted for 6000 installations for the financial year.
The introduction of the $100,000 income means test by the government earlier this year has done little to stem the flow of applications – which is a testament to the Australian people for their willingness to make the switch to solar power and a slight on the Australian government for not supporting that interest.
While the orders for new system installations are flooding in at present, the uncertainty about the rebate also means that some providers are hesitant to put on new staff to help deal with the demand – as the rebates could suddenly disappear at the stroke of a pen.
There may be somewhat of a silver lining to the rebate cloud hanging over the solar industry – it’s also rumoured that the solar power rebate may be changed to a national gross feed in tariff, paying consumers with grid connect systems a premium on all electricity they produce.
For those homeowners who have a system already installed or have one installed soon; it may provide two bites at the cherry and still provide some incentive for the continued, albeit likely leveling off, of demand for grid connect system installations post-rebate. However, even if this should eventuate, some smaller providers are likely to be forced to leave the industry or to merge with larger players.
