Australian ‘solar tax’: Solar supporters divided on how to make the electricity grid fairer | Energy


Michael Streatfeild was one of the first to embrace solar power. About a decade ago, he took $ 15,000 off his mortgage to install a 3.6kW panel system on a northeast section of his roof in western Sydney.

Three years ago, in an effort to eliminate his reliance on coal-fired grid electricity, he added a 4kW system and positioned it to catch the sun later in the day when it comes. from the northwest.

The sharp drop in the cost of solar power in recent years meant that the second system, although larger than the first, cost only $ 5,000, a third of what it paid for in 2011. Together, the two systems have all but wiped out its electric bills – its last two have brought in refunds of around $ 100.

Streatfeild is part of a growing Australian history. About 2.8 million homes have solar systems, and another 3 million are expected to join them over the next decade. The flood of solar energy that these homes create in the middle of the day when the sun is high quickly and dramatically transforms the electricity grid.

During peak hours, just over half of the electricity on the national market now comes from renewable sources, compared to around 30% over the year. In his first speech this week, the new head of the energy market operator, Daniel Westerman, set a target for the entire grid to be able to run entirely on renewable energy, at least for brief moments, by 2025.

According to regulators and some analysts, this solar surge, while welcome, is also causing potential problems by creating “traffic jams” in a system that was largely designed to send power from a few large generators to homes and businesses.

This prompted the Australian Energy Market Commission (AEMC) in March to propose a change that could give grid providers the power to charge people who export electricity into the grid at times when it doesn’t. is not necessary. He argued that the change was needed to make room for more solar home systems and batteries to be connected to the grid, and to make the system fairer for all users.

The commission, which sets rules for the electrical system, suggested two-way pricing that better rewarded owners of solar and battery power that send electricity to the grid during peak hours – in the early evening, for example. He also recommended new incentives that would give customers more reasons to buy batteries or electric vehicles, or to upgrade their homes to use the electricity they generate at peak times.

The proposal has proven to be divisive, pitting against one another those who want to see a rapid expansion of solar power but have different views on what is needed to make it happen.

From Streatfeild’s perspective, the potential new tax is unreasonable, but not surprising. A former police officer and member of the advocacy group Solar Citizens, he says he was motivated to get signs by the climate stance of then-opposition leader Tony Abbott and his thoughts on the future of his grandchildren. “I wanted to be able to tell them, ‘I didn’t screw this Earth up for you, I did my best,'” said Streatfeild.

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He believes large power generators and grids have a history of profit and should bear all transformation costs, while solar consumers should be rewarded for lowering the wholesale price of electricity by downsizing power plants to aging charcoal – and increasingly unsustainable.

“This is really mismanagement by the network operators, in my opinion,” says Streatfeild. “They should have foreseen the need for all of this. They seem to just want to fuck us again.

Solar Citizens takes a similar position. He called the AEMC proposal a “solar tax,” and said solar homes and businesses should be rewarded for the benefits they offer, not penalized.

“People have invested in solar energy in good faith,” says Ellen Roberts, national director of Solar Citizens. “Every time people invest in something and the rules change, it violates a principle of fairness. “

But the arguments over fairness and solar power get complicated quickly – the same principle is being used by supporters of the AEMC proposal.

They say the change is needed in part to ensure a more equitable system for poor households who cannot afford solar panels and therefore bear a greater share of the grid costs.

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The AEMC draft rule followed proposals from an unlikely group of groups, including the utility company SA Power Networks and welfare organizations, the Australian Council for Social Services (Acoss) and the Company. Saint-Vincent de Paul.

Kellie Caught, senior climate and energy advisor for Acoss, says the country needs a swift transition to renewable electricity, but the question is who is paying for it.

About a third of households are renters, so they cannot install solar panels and depend more – and pay more – on poles and wires provided by power grids than those that use solar energy.

Caught says the people with solar panels haven’t created the problem that regulators are trying to solve, but she believes the proposed rule change would benefit both grid security and consumers. “Right now, the people who can least afford it bear a greater share of the costs of the network,” she says.

She says it is important for the change to empower consumers with solar power by giving them, not grid operators, the choice of paying to export electricity at peak times or simply accepting a limit. on how much they can send to the network.

Dylan McConnell, a researcher at Climate and Energy College at the University of Melbourne, also argues that reducing emissions must be a priority, but socially just. He cites research conducted by the Grattan Institute in 2015 which suggests that the effective subsidy paid by non-solar households to those using solar energy would be $ 3.6 billion until 2030.

McConnell says central to the debate is whether home solar power owners are entitled to earn income by exporting to the grid, given that they save money by using their solar power. self-generated at home, and whether this right comes with a responsibility to contribute to the infrastructure changes necessary to make this possible.

Bruce Mountain, director of the Victoria Energy Policy Center, strongly disagrees. He argues that the change proposed by AEMC is based on a mistake, as the poorest households share the financial benefits of increasing the use of solar energy to a level that far exceeds grid costs. additional ones they face.

He also suggests that there is no evidence that more solar power on the grid in the middle of the day is a problem that could not be solved at low cost. “There just isn’t strong evidence of a problem for which export pricing is a solution,” Mountain says.

State governments have expressed concerns about the change to varying degrees. Victoria and Queensland have both indicated that they do not bear the export costs. Some states have suggested keeping all costs so that it doesn’t affect people who already have signs.

Other submissions to the AEMC argue that to be effective, the change must ensure that solar energy owners who do what they want – export their electricity when it is needed most – are well rewarded.

They say it must become attractive to buy a home battery or EV that can both tap and export electricity to the grid. Neither technology has received the level of government support offered for roofing panels when they were at similar adoption levels a decade ago. Coincidentally or not, AEMC this week released a separate draft plan that it says will make it easier for small battery owners to send electricity to the grid and generate income.

The commission argues that the average solar household with a system between 4 kW and 6 kW will still do well after the proposed rule change. He estimates that they will save about $ 900 per year on electricity bills – about $ 70 less than they are now – and that households without solar power would see their bills reduced because they would no longer have to pay for utilities. solar export that they do not use.

It says alternatives to introducing an export cost, such as blocking people’s solar exports when the grid is on, or building more poles and wires to allow more solar traffic. , would be more expensive for consumers. The first would also have the effect of reducing the amount of renewable energy entering the grid.

The chief executive and chairman of the commission, Benn Barr and Anna Collyer, point out that the rule change would not impose an export fee, but would allow networks to make proposals. The change would start in 2025.

Barr says all governments are backing what he describes as profound change – recognition for the first time that power grids must take electricity from homes, not just supply it.

“What this means is that these companies now have an incentive and an obligation to upgrade the grid to get more solar power and be ready for the arrival of electric vehicles,” Barr said. “It’s got lost a bit, but it will really change the way these businesses operate and benefit consumers across Australia.”

A final decision on the rule change was initially expected earlier this month, but is now expected on August 12.


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