If support for the purchase of small solar power systems under the Renewable Energy Target evaporated; how much more would a system cost? A lot more.
ACIL Allen, the consultants engaged by the RET review panel, forecast that as a result of the SRES (Small-scale Renewable Energy Scheme) being removed, solar installations would fall by 30 per cent.
Ric Brazzale, Managing Director of Green Energy Trading and President of REC Agents Association, disagrees and states it would be much higher. Even modelling indicating the removal of the RET would lead to a 40 to 50 per cent reduction may be optimistic.
“If we were to remove the value of small-scale technology certificates (which are currently worth $2,295 for a 3 kW system) then the upfront cost of a PV system increases by 44 per cent and the payback increases from 7.2 years to 10.1 years,” says Mr. Brazzale.
“This is nearly a three year increase in payback and is longer than the average period that people are staying in their homes of 9 years (RP Data).”
Such a scenario would have a major impact on purchase decisions – and consequently jobs in Australia’s solar sector. Suddenly, many thousands of households that planned on taking more control over their energy bills would perhaps see the prospect of acquiring solar panels slipping from their grasp.
Mr. Brazzale says the number of residential solar PV installations fell from 350,000 systems in 2011 and 330,000 systems in 2012 to approximately 200,000 in 2103. This year will see an estimated 170,000 residential systems in 2014.
“This is nearly a 50 per cent reduction in the number of system installations from 2012 to 2014 driven by changes to State and Commonwealth Government policy settings.”
With the future of the RET still anything but assured, the best time to go solar may be right now.