With more than 275,000 Australian solar households across three states set to come off “premium” solar feed-in tariffs by the end of the year, a new report advises consumers on how the change will affect them financially, and how they can manage this impact, using a combination of current technologies and retail strategies.
As the report from the Australian Technology Association notes, a total of 275,902 NSW, Victorian and South Australian households will lose their premium FiT by the end of 2016.
This includes 146,000 in NSW, whose 60c/kWh rate via the Solar Bonus Scheme closes December 31; 67,160 in Victoria (plus an unknown amount of households on the “one-for-one” tariff) where the 25c/kWh transitional feed-in scheme closes on December 31; and 62,742 in South Australia, where the 16c/kWh tariff ends on September 30.
For all of these households, the new rate they will be offered for rooftop solar power exported to the grid will plunge to between 5c-7c/kWh. The prospects are best for South Australian customers, where the minimum retailer payment is 6.8c/kWh. In Victoria, 5c/kWh is the minimum mandated payment, and in NSW the decision is left up to retailers, with a “benchmark range” of between 5c and 7.2c/kWh recommended.
As we have noted many times before on both One Step Off The Grid and RenewEconomy, this amounts to a very bad return for most solar households, unless they happen to be in the position of using all of the solar power they generate as they generate it. For the rest, it makes the case for adding battery storage a lot more attractive – something battery storage manufacturers are betting on as they target the Australian market.
But what else can these 275,000-plus households do to ease the pain? According to the report, Life After Feed-In Tariffs, there are four main things to consider – five if you are in NSW:
- NSW households, the report says “should probably move to net metering” to access your data and use that information to inform your next move.
- Use more of the solar you generate, when you generate it. The report recommends doing this by running more major appliances during daylight hours, particularly hot water services, air-con and home heating.
- Quit gas: using gas for hot water or heating and cooling will prevent you from making the most of your solar electricity, the report says.
- Shop around for the best retail deal, making sure to factor in all costs, including fixed charges, energy rate, discounts and solar tariff.
- Consider adding more solar, or battery storage. Here the report notes that “given the poor economics of storage in 2016, it is advisable to wait … and instead, ensure (the other steps) are fully implemented. In two to three years’ time, the report adds, batteries will have reduced in cost, “and your existing inverter may be coming close to needing replacement anyway.”
The report adds: “Following these steps, and with battery prices low enough around 2020, it should be eminently achievable for most solar homes to be consuming the majority of their own solar electricity whilst at the same time reducing their annual stationery energy bills to below $500 per annum (a reduction of around 75-83 per cent on what most Australian households currently pay per year).”