Solar Credits Subsidy Threatened By Big Business

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The Renewable Energy Target review has resurrected many myths, misconceptions and much misinformation about small scale solar power – some of which could threaten remaining subsidies.

According to an article on The Australian web site, the Energy Users Association of Australia (EUAA) is urging the Renewal Energy Target review to recommend dumping the small-scale renewable energy target for solar panels; and with it the remaining subsidisation.

The EUAA is reportedly claiming the RET is encouraging mostly power generation technologies that provide “part-time” electricity says The Australian.

However, this “part time” electricity has had a substantial impact on reducing the price of wholesale electricity due to the Merit Order Effect. The fact this reduction is not being passed on has more to do with the reported “gold-plating” of electricity infrastructure; an issue that even Australia’s Prime Minister has acknowledged as being a major problem. The EUAA also apparently makes mention of electricity retailers possibly profiteering from the subsidisation of small scale solar power.

As facts often don’t come into play in policy reviews or are drowned out by the screaming of the ill-informed, the threat to solar subsidies could be very real. The EUAA does have some clout given it is the national association of large electricity and gas users, with members including BHP Billiton, Rio Tinto, Shell and Xstrata. Companies with fossil fuel interests have a healthy showing among its membership.

The Solar Credits subsidy (also commonly referred to as a rebate) is now a shadow of its former self, but can still reduce the cost of installing a solar power system by thousands of dollars even at its current level.

While the multiplier associated with the subsidy will be phased out altogether next year, with Australia’s track record on solar incentive flip-flops; perhaps households thinking about going solar should consider acting sooner rather than later.