The solar power boom may be leading to government subsidies such as feed-in-tariffs becoming less viable, according to an ABC News report.
This is due to the possibility of an energy oversupply. Basic economics says that once you have an excess of a thing, it loses some of its value. This could mean that if more power is generated than can be used, selling it back to the grid may become an inefficient thing to do.
This is the argument of Tony Wood, energy program director at the Grattan Institute. Mr Wood said where too much energy is produced in the middle of the day, it can have an impact on grid stability, and may in time lead to cuts in government rebates for solar power.
What is driving the solar power boom?
Many Australian households have been searching for the best solar quotes online and installing rooftop solar. After all, last year, millions of solar panels found a place on Australian rooftops. Data from the Clean Energy Regulator (CER) shows there were more than 9,500 panels installed a day on average. This is over 40 per cent more than in 2016.
The main factors driving the boom are the rising costs of electricity from the grid, and the falling prices of solar panels. Solar panel owners are also saving money by selling the power they can’t use back to the grid. This reduces their bills and sometimes even earns them a credit.
However, as stated above, while the boom is great for Australian households and businesses, it could result in an oversupply.
The good news for solar users
A solution for solar panel owners is to store the excess energy generated in energy storage batteries. Solar owners can then use the stored energy in the evenings or on dull days.
As well as an increase in solar panel installations last year, purchases of solar batteries skyrocketed. This is largely due to their increasing affordability; batteries can pay themselves off in savings within a few years.
The second piece of good news is that improvements in battery technology in recent years has made them more efficient. Today’s lithium batteries are lighter, have a higher energy capacity and a longer cycle life than for past models. Solar credits are still available for solar plus energy storage system installations, providing further incentive to buy solar batteries.