“Businesses will be going to the line:” Covid puts rooftop solar on hold in two states

Australia’s rooftop solar industry is facing its latest major Covid 19 challenge, as tightening lockdown restrictions in New South Wales and a fifth state-wide lockdown in Victoria bring to a halt the majority of business for the majority of residential and commercial installers.

In NSW, the lockdown in place for Greater Sydney, the Blue Mountains, Central Coast, Wollongong and Shellharbour was tightened over the weekend, after the state failed to rein in infection numbers.

The restrictions now prohibit all work at construction sites in these regions, unless the work is urgently required, and all renovations or other works at a place of residence to make alterations or additions – unless necessary for the safety or security of the site.

This translates into no rooftop solar installations for a massive slice of the state, unless for some reason there is a maintenance issue with an existing system that requires urgent attention, as a matter of safety.

In Victoria, which went into lockdown 5.0 on Friday last week, the rules this time around are spelled out as part of the Victorian government’s guidance to the state’s construction sector, even with a separate section on solar installs.

“Solar installations on occupied homes are not considered construction and must cease under current restrictions unless they are required to maintain or protect human health, safety, and wellbeing,” the rules state.

“Solar installations as part of construction projects may continue (ie at unoccupied properties).
Urgent maintenance or repairs to ensure electrical or gas supply can continue, including for off-grid premises supplied by solar power or batteries.”

How each of these lockdowns will affect rooftop solar installations in both states remains to be seen, depending on how long they remain in place and whether the rules shift at all to allow at least some jobs to go ahead.

In Victoria, the Andrews Labor government on Monday indicated that the initial five-day snap lockdown would be extended, but had not – at the time of publication – said for how long. The outlook for NSW, meanwhile, is not promising.

Of course, each state has its small advantages: NSW can continue with business as usual in some regional parts of the state; Victoria can continue with installs on new-builds, or unoccupied residences and buildings.

But however you spin it, both industries in both states are in for a tough time, and particularly New South Wales, which had already been experiencing somewhat of a lull in installation activity in 2021.

Compounding things for both states, says SunWiz managing director Warwick Johnston, is a market where prices have fallen 20% at the same time as installation activity has risen by 20%, meaning businesses’ revenues might be taking a hit even as the market grows.

This increasing pressure at the margins is already starting to show, with two major players in the industry going into administration over the past two weeks alone: Powerark Solar and Autonomous Energy.

“We’re now in that frustrating period of Covid where, already, sales were slowing down,” Johnston told One Step on Monday, thanks to fall-out from the previous year and the winding back of federal government stimulus packages.

“NSW, in particular, wasn’t on a great pathway. …Now you’ve got this major blockage to doing any work; businesses will be going to the line.”

But on the positive side, Johnston says it is worth remembering that Victoria has been in this position before and has come out the other side. What NSW is missing that Victoria had, however, is state government stimulus – in the form of the Andrews’ government’s rooftop solar and battery storage rebates.

“Maybe NSW might follow suit and allow installers back onto roofs before they allow cleaners back into homes,” said Johnston, noting the state has a “great” energy minister and might look to the same sort of home and business solar-based stimulus packages once the recovery period begins.

“The salvation is that we’ve been here before. It’s a little bit different this time around, but hang on in there,” said Johnston.

“My advice to solar businesses is you that can still sell solar systems. But now is the time when it’s more important than ever to look at investing in operational efficiencies.”

See, too, 10 things rooftop solar installers can do in Melbourne’s Stage 4 lockdown, noting that different restrictions apply to businesses in NSW.