Why we should thank John Howard for starting the rooftop solar boom

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The solar industry has a lot to thank the Liberal party for.
We owe a lot to John Howard. He may not have realised it in May 2007, but when he doubled the Photovoltaic Rebate Program value to $8000, our 2ndlongest serving prime minister set in motion a chain of events that would lead to Australia hosting 2 million rooftop solar power systems.
A little more than 12 months later, the Rudd government, facing a significant budget overrun, announced that applications to the Solar Homes and Communities Program would close that night.
Every person in the solar industry worked until midnight, and I remember being highly impressed by the thousand-odd applications that the nation posted in at short notice.
In hindsight, what a cottage industry we were – these days, over one thousand systems are installed every day, with system sizes seven times larger.
Recognising the public appetite for solar energy, the Rudd government created another vote-winning policy that morphed the Renewable Energy Target (RET) into providing greater support for solar power via a solar multiplier.
This act perpetuated a boom-bust cycle as households flocked to take advantage of the subsidy; typically on the eve of that subsidy being reduced.
Whereas 50,000 households installed solar in 2009, that number was dwarfed by the 360,000 installations that occurred just two years later. In one month, Australia installed almost 70,000 solar power systems.

Concurrently with changes to federal subsidies, states were vying to outdo each other with schemes that compounded the consumer’s appetite for solar energy. While states’ actions certainly accelerated the rollout of rooftop solar, state governments attempts to wind back subsidies often actually increased customer demand.
Queensland, Victoria and South Australia implemented a progressive wind-back which acted as a comparatively soft landing; this stands in contrast with the New South Wales and Western Australian Governments.
The day solar power became political power
The day that solar power came to power as a political force was the day the solar industry forced a humiliating backdown upon the newly minted O’Farrell government.
The NSW government of the day decided to retro-actively reduce the feed-in tariff contracts that had been signed with hundreds of thousands of NSW residents – mortgagees and pensioners alike.
It was an impressive sight to witness thousands of mostly elderly pensioners protesting in Darling Harbour. It was also the first time that the government email system broke down because of being overloaded by disgruntled voters, thanks largely to the actions of AUSES and SEIA. It took three weeks for the government to retreat.

The Western Australian government, ignoring history and despite being warned not to do so, later attempted to do the same. By this time Solar Citizens had formed and a back-down only took three days – with the WA Coalition government also coming under pressure from their federal colleagues who were in the midst of an election.
Tony Abbott did all that he could to remove subsidies from rooftop solar when Dick Warburton was commissioned to review the RET.
Naturally, Warburton recommended that the SRES be closed immediately or soon phased out. Protracted negotiations about the LRET followed, but amendments to the SRES were quickly taken off the table by the Abbott government, under immense pressure from voters.
More recently the ACCC have also attempted to scrap the SRES, and again a public campaign forced the Energy Minister of the moment to announce that the SRES wouldn’t be going anywhere.
You’d think that politicians would have realised by now that renewable energy is immensely popular. Poll after poll concludes the same.
Every time the Coalition beats up on renewables or harp on about electricity prices, Joe Public votes with their wallet and buys a solar power system. Its about the easiest way to significantly reduce electricity bills. And what’s more, its loved by Left and Right alike.
The latest Essential report shows that Transitioning to Renewable Energy is the most important action item for Labor & Green voters, and 3rdmost important to LNP voters.

In looking back over this article, it’s clear that all of the most drastic attempts to poison the solar industry have come from Coalition governments.
There are some exceptions – the current SA and Queensland governments certainly have some decent solar & storage policies.
Still, in light of all of the above, perhaps I was being a tad facetious by suggesting we should credit the Coalition for the solar industry’s success. (I wonder if the federal Coalition has cottoned on to the fact that almost all of the top 10 postcodes for solar uptake in Australia are held by the Coalition.)
Australia as a leading solar nation
In the meantime, our sunburnt country is amongst the world leaders in solar uptake. Australia:

  • Has ranked in the top 10 nations for annual installed capacity for every year since at least 2008.
  • Ranks fifth in the world for per-capital installed capacity. At the end of 2017, Australia had 299Watts of power per inhabitant.
  • Is in the top 10 countries for PV energy penetration. At the end of 2017, 4% of Australia’s electricity consumption was produced by solar energy. That figure is set to leap in 2018, considering all the solar power that’s been added this year.
  • Must certainly rank #1 in the world for the number of installed systems per capita.
  • Will in 2018 smash its record for capacity installed. Over 1.5GW of sub-100kW solar power is anticipated to be installed, compared with 1.1GW in 2017

Thanks to the actions of millions of Australian households, the process of modernising our grid is well underway, and households are collectively saving billions of dollars off their electricity bill.
Households grew fed up of being taken for a ride by governments and utilities and have taken matters into their own hands. To me, that’s true democratisation of energy.
To celebrate the 2 millionth Australian solar power system, SunWiz has released a Australian PV Primer report. This report tracks the Australian PV market in charts and commentary, from history through to today, plus the trends that will play out for the coming years. See here

Solar uptake and Penetration by postcode

# installations by size bracket

 
 

This post was published on December 3, 2018 1:59 pm

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  • I so remember this:- Warburton recommended that the SRES be closed immediately or soon phased out.
    His findings in detail showed that the cost increase for power prices was less than the contribution in lowering prices.
    Even with the figures in his report showing the opposite, he still followed the expected outcome the Government wanted.
    The well known usual players in the Shock Jock industry have never given up screaming “ Renewable Energy subsidy for the rich is putting up the price of power” .
    Still in Federal Parliament the same refrain is rolled out at every occasion.
    I do remember before that time a Federal Senator’s statement “Solar Panels will never pay for themselves in a million years !!!”.
    I have heard this story face to face then went through the figures to show them how misled they were.
    Over time at least 10 families have installed PV and are happy even the bloke who said he would eat the receipt for the first cheque i received.

  • not sure your memory is quite correct. at the first labour budget in 2008 the ALP announced they would *means test* the $8000 rebate from midnight that night (I remember because I had a stack of completed but yet unsent rebates on my desk I had to suddenly go and post). The REC 5x multiplier proposal came about 6-9 months after that and from memory was implemented around July 2009.
    p.s. John Howard doubled the PVRP (later to become the SHCP) rebate in an election year (2007) so it's easy to be a bit cynical about motivation, but I am glad he did it.

    • Hi Rob. I just wrote a piece above in response to Rod. You would be write about the is history of the solar rebates. Rudd axed the $8,000.00 rebate and replaced that with the REC's system of rebates. As for Howard it was purely political as his comments since reveal his true beliefs about giving support for renewable energy.

  • I thank Little Johnny every time I get my AGL credit. My first array went in around 2001 and I'm pretty sure the rebate was $8,000

    • Hi Rod, It was a last desperate throw of the 'green vote' dice that 'Honest John' came up with his $8,000.00 subsidy. It did him no good as he got punted out of government and out of his own seat of Bennelong ( thank you Maxine!) when Rudd / Labor won the 2007 election. But I have to join you in thanking 'Honest John' for it was 'Honest John' who got me started in my home solar journey. In February 2008 I installed a modest 1kW rooftop system. It was a 100% German manufactured system - Conergy panels and inverter. The headline price was $12,000.00 but thanks to 'Honest John's' $8,000.00 I only paid $4,000 plus an extra $400.00 for a 'Net Meter'. Since then I've installed more panels in 2010 and 2016 but the subsidies were much smaller under the REC's system.

      • Yes, I should be more thankful. The crazy prices back then, I would not have gone ahead without the subsidy. I also got some RECs in 2008 for my extra 1.5kWp. And I got two free meters. The first one a bi-direction meter and then a "smart" meter.

  • Interesting history - my question is what can one install today for say $5,000 compared to May 2007. I suppose it should be compared more to $3,500 in 2007 to allow for inflation but I'm interested either way

    • I've just looked up some actual PV invoices from 2008 and 2018.
      In early 2008 a quality (japanese panels and european inverter) 3.15kW system was $15.5K out of pocket (after the $8K rebate and $3.2K in RECs came off, so $26.8K unsubsidised or around $8.50/Watt unsubsidised or $4.95/Watt out of pocket).
      In late 2018 a quality (singaporean panels and european inverter) 6.49kW system is $7K out of pocket (after $3.7K of STCs come off so, $10.7K unsubsidised or around $1.65/Watt unsubsidised or $1.08 out of pocket).
      That's a drop of 81% unsubsidised (or a drop of 78% out of pocket) in a decade.
      In addition today's systems monitors generation and consumption on the internet and send alerts if there is a problem

  • well my 9.88 Kw system installed 3 years ago today cost me $12509.00 after rebates
    FFS i COULD GET IT FOR HALF THE PRICE NOW!

  • Think Howard was just trying to buy another term and was wildly overspending. Someone else had to clean that up.

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