Rooftop solar rebates slow to a trickle in Victoria as Covid-19 starts to bite

What a difference a global pandemic makes. Last year, the Victorian state government was forced to increase the number of residential solar rebates put on offer each month, to better meet seemingly limitless demand and avoid putting a cap on the state’s booming market.

Even then, after tripling the number of applications for the month of September, all 6,500 of the rooftop PV rebates put on offer for the first half of that month disappeared inside of one hour.

Fast forward to March 2020 and the uptake of the Solar Homes rebate – which this year offers a slightly reduced discount of up to $1,888 on rooftop solar for Victorian households – has slowed to a relative trickle.

At the time of publishing, a total of 4,928 home solar rebates were still up for grabs out of a total of 5,927 opened for applications in the month of March – nearly 1,000 of which were unsubscribed offers carried over from February.

The change is not entirely unexpected, however. After months and months of record residential and commercial solar growth in Australia, the rooftop market is bracing itself – like so many other industries – for a hit from the unprecedented Covid-19 pandemic.

As Giles Parkinson and Nigel Morris discuss on the latest Solar Insiders podcast this week, demand has been up in some quarters and down in others, but there is a real and growing fear of “a brutal slowdown. Yet another solar-coaster.”

In the space of just weeks, concerns around solar PV supply have quickly shifted – as the market in China, ground zero for the novel Coronavirus, gets back on its feet – to concerns around demand, as households hunker down and businesses shut down in the name of virus containment.

“The supply chain seems to be ok from the manufacturers to the wholesalers. It’s when you get to retail land that it gets quite different,” said Solar Insiders co-host and industry veteran, Morris.

“There are some companies out there that aren’t getting leads… so people just aren’t ringing. In other cases I’m hearing that lead-flow is ok, but I think the average lead-flow seems to be about 20 per cent down across the board, which is understandable giving everything that is going on.”

Worse, the industry could be bracing for an even bigger hit, depending on how any further lock-downs, and the status of the solar sector as an “essential” supplier, pans out.

Morris said he was hearing from a range of installers that there were also rooftop solar jobs being cancelled; in some cases because people were putting all their time, money and energy into managing the impact of the Coronavirus; and in others, because they didn’t want workers on and in their home.

So is that what’s going on with the Victorian solar rebate? It’s difficult to say. Obviously there will be other factors at play, including perhaps the reduction in the rebate amount – last year it was $2225.

But as Michael Bloch on Solar Quotes points out, it’s still a really great deal for the average Victorian household – particularly at a time when any savings on energy bills will be at a premium.

“Just as an example, a good quality 6.6kW system fully installed costing around $6,600 with the national subsidy taken into account will cost $4,712 with Victorian rebate factored in,” Bloch writes.

“Using that figure in Solar Quotes’ solar calculator for system cost and using the calculator’s other default settings indicates this system installed in Melbourne should pay for itself in 2 years, 5 months and provide savings over 10 years of an estimated $20,815.”

And Morris agrees. “For those people, millions of people who are under economic stress at the moment, (installing rooftop solar) is the number on thing that can be done (to save on energy costs) and it can be financed.

“We think that there is a wonderful opportunity here to try and help keep the (solar) industry alive and deliver resilience and employment and support for struggling companies Australia-wide,” he said.

Solar Victoria, the government body that runs the state’s rebate, is doing its bit on this front by offering assistance to participants in the scheme that are experiencing hardship from either the devastating summer bushfires or from Covid-19.

But whether applications for discounted home solar systems start to pick up as time goes on remains to be seen.

Solar Victoria told One Step there had been a growth trend in the number of rebate applications and installations over the  past three months, and 5074 installations in February, the highest monthly total this financial year.

“Solar Victoria is working with industry and industry groups regarding the potential impacts of the coronavirus,” said Solar Victoria CEO Stan Krpan, in an emailed statement.