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AGL Solar – Company quits rooftop solar business.

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AGL solar – the company announced on Tuesday that they will record a $47m loss from their residential rooftop solar installation business. 

AGL solar installation business to shut down.

AGL Solar Installations
AGL Solar Installations (source: aglsolar.com.au)

AGL bought the Rezeko brand around seven years ago and used its systems to install “proprietary residential solar”. They’ve now put out a press release advising that they will write down the company’s residential solar arm. 

With the imminent (2022) closure of their Liddell coal generator, it makes sense that the company are trying to diversify with regards to methods of energy generation. It’s a shame that this hasn’t worked out, and we’ll be interested to see how it affects AGL’s vision of renewable energy moving forwards. 

“We decided to withdraw from the direct installation of residential solar hardware after completing a comprehensive review of the business,” AGL Chief Customer Officer Melissa Reynolds was quoted as saying in an email to Renew Economy. 

“The review determined that the interests of our customers would be better served by moving to a different business model. Under this model we forward enquiries for residential solar hardware installation to our third-party partners which are experts in the installation of PV solar.

“AGL will continue to provide advice to customers on solar energy and energy plans.”

AGL was one of the country’s top 10 residential solar installers, and in the top five of commercial solar installers. It remains to be seen what the ramifications of this writedown are, but we’ll keep you updated with how things are going. What we do know is that their commercial solar installation arm will remain unchanged as it’s presumably much more profitable than the ‘race to the bottom’ we’re seeing domestic solar installers engaged in.

The company says its plans for virtual power plants in Adelaide and elsewhere will not be affected. 

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Two bidders for Liddell power station.

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Delta Electricity have entered the contest with Alinta Energy to buy the Liddell power station – a coal-fired, ageing plant that still pumps out 1680MW and is owned by AGL, who have advised that they’ll close it by 2022.

Liddell Power Station

Liddell Power Station
Liddell Power Station (source: wikipedia.org)

Following the shutdown of the 1600MW Hazelwood coal-fired power plant last year, customers saw power shortages and a spike in power bills. The government is concerned that the same thing will happen if the Liddell power station is shut by 2022 – with PM Malcolm Turnbull directly telephoning AGL chairman Graeme Hunt this week to talk about the sale.

AGL haven’t allowed Alinta Energy or Delta Electricity to do any due diligence on the plant – with Delta MD Greg Everett telling the Sydney Morning Herald is was a major hindrance for the company who have been shut out from performing any in the past, as AGL advised they weren’t willing to sell:

“Would we be interested? If it was for sale we would definitely be interested in doing due diligence on it,” Mr Everett said.

“So we’d be in the same position as Alinta.”

Everett and Delta already operate the Vales Point coal-fired generator in NSW and the company was previously owned by the NSW government. Everett has been quoted as saying there is a ‘reasonable’ chance of extending the life of the program past 2022.

Alinta chief executive Jeff Dimery made a statement this morning confirming that their company are interested in Liddell, and if they sign a deal they aren’t going to apply for any government subsidies. Dimery advised that Alinta are willing to invest ~$1 billion AUD to buy the plant and extend its life by five to seven years. This would see the plant shutting down around 2027-2029 instead of 2022. 

AGL are keeping fairly taciturn about the situation:

“AGL is relying on Liddell to generate power for our customers until 2022 and we will require its infrastructure for our replacement plans into the future,” an AGL spokesman told Fairfax Media.

“AGL received an approach from Alinta last night expressing an interest in entering negotiations to acquire the Liddell Power Station. No formal offer has been received.

“Should a formal offer for Liddell be received, it would be given consideration in order to meet our obligations to customers and shareholders.”

There’s no doubt that Australia are moving towards renewable, clean energy and this is a good thing. The transition, however, needs to be done in an intelligent way – it’s be great to be totally renewably powered as soon as possible but it’s going to be a patience game as the technology increases and we work on reliable baseload power while we invest as much in renewable energy generation as we can. Where will we be in 2022, RET wise? It’s hard to say. We’ll keep you updated with any news about the plant’s potential sale. 

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AGL Virtual Power Plant Upgrade?

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AGL have confirmed that their trial of networked home storage batteries has been halted temporarily as they manage unknown variables with their ‘Virtual Power Plant’ – which was labelled by AGL as the ‘largest project of its kind in the world’ earlier this year.

Virtual Power Plant

AGL Virtual Power Plant
AGL Virtual Power Plant (source: @AndyVesey_AGL)

The scheme went live in March at West Lakes in Adelaide and has see hundreds of households’ solar and battery storage linked together to form a 5MW ‘virtual solar power station’. The scheme cost $20m and ARENA (the Australian Renewable Energy Agency) kicked in $5m of that to back the project. As such the cost to the consumer was heavily subsidised and interest has been very high within the test area. 

At the time AGL MD and CEO Andy Vesey said “Our South Australian VPP demonstration is a practical example of the new energy future,” – noting that AGL planned their ‘VPP’ will deliver benefits by increasing grid stability (albeit just for the test group for the time being). The batteries installed were by Sunverge, a producer of intelligent energy storage and advanced AC-coupled storage systems. They use a proprietary virtual power plant software, and in this situation were unique as all the batteries could be remotely operated by AGL. Some customers paid extra for the AC coupled storage systems so they could use them during a blackout. 

There have, however, been potential hiccups with the Virtual Power Plant this week as AGL wrote to waitlisted customers to advise them they won’t receive any of the current Sunverge batteries, and that they plan to utilise “next-generation battery technology into our next phase of installations”. 

The ABC asked AGL about the issues with their VPP and they dodged the question about how many batteries being replaced (and what their upgrade plan is), but a spokesman did say that “Lessons and customer feedback from the initial phase of the project are being used to shape subsequent phases and we want to ensure that all customers have an opportunity to opt in to the next generation offering,”

We’ll keep you updated to see what they’re going to offer for the next phase of their Virtual Power Plant – another exciting step for energy storage technology for South Australia.

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2017 NSW Tariff-Tracking Report released.

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The St Vincent de Paul society has released its fifth NSW Tariff-Tracking report and it shows the huge disparity between deals the retailers are offering – with the best offers saving almost $840 p.a. compared to those on the worst plans. In regional NSW this range is even worse, with the difference reported by the SMH as up to $1230. Australian solar power plans are in need of a shake-up and this week the government have taken the retailers to task by asking them to change the way they deal with discounts and rolling over plans.

2017 NSW Tariff-Tracking Project Report Vinnies
2017 NSW Tariff-Tracking Project Report (source:vinnies.org.au)

NSW Tariff-Tracking

Despite ballooning wholesale energy costs, retailer AGL reported a net profit of $539m for the 2016/17 financial year. The profits of energy retailers have been in the crosshairs of the government over the past few months as their dubious tactics of offering short term discounts and then rolling customers onto more expensive plans without the discounts have been examined.

On Wednesday the government met with eight power companies (Energy Australia, Momentum Energy, Simply Energy, Alinta Energy, Origin Energy, AGL, Australian Energy Council and Snowy Hydro) to discuss the rapidly increasing prices and come up with a solution to the murky short-term ‘discount’ based business model they are employing. After the meeting Prime Minister Malcolm Turnbull discussed the issue and the government’s fix, saying  “They are on … discounted plans that have run out, and they are now on a standard offer and paying too much for their electricity. The retailers have agreed that they will write to their customers who have reached the end of a discounted plan and outline, in plain English, alternative offers that are available,”

Given that the Energy Market Commission found 50% of households haven’t changed retailer or plan in the last 5 years, there’s a lot of money being left on the table. According to Energy Minister Josh Frydenberg the Australian Energy Regulator (AER) have told the government households could save over $1,000 per year by changing retailer/plan.

In terms of the power companies, they were mostly happy to agree to Turnbull’s plan, but there was ongoing discussion about Canberra’s dilly dallying with regards to the Clean Energy Target. Origin Energy’s chief exec, Frank Calabria, was quoted by the SMH as saying that “to deliver a genuine reduction in prices for Australians, we must also find a way through on energy policy, including a Clean Energy Target. This is necessary to unlock investment in much-needed new supply to replace our ageing coal-fired power stations, and transition us to a cleaner, more modern energy system”.

Click here to view the full report directly from the Vinnies website.

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Solar Citizens call for 10-18c/kWh for rooftop solar

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Solar Citizens, a “people-powered movement bringing together millions of solar owners and supporters to grow and protect solar in Australia”, has penned an article calling for a fair price for solar, advising that a reasonable cost is between 10-18c/kWh for PV rooftop solar feeding back into the grid via an FiT (feed-in tariff). Today we’ll take a look at what Solar Citizens think is a fair range for those helping shore up the grid and which states are coming to the table with regards to this range.

About Solar Citizens

Solar Citizens
Solar Citizens (source: solarcitizens.org.au)

The report, entitled “A fair price for rooftop solar“, is part of the “fair value for distributed generation project” created by Solar Citizens. Solar Citizens are, as per their website, an ‘independent, community-based organisation bringing together millions of solar owners and supporters to grow and protect solar in Australia’.

The report delves into detail about the current FiT situation in Australia (it’s currently set state to state) and notes that the total ‘value’ per kWh should be anywhere from 10.6-18.2c. This is as a direct result of the wholesale price of electricity skyrocketing over the past 18 months and, although FiTs have increased as a result, many states aren’t reaching the 10.6c/kWh mark or are only just there.

Solar Feed-In Tariff State Comparison

On January 1, 2017, many Solar Bonus Schemes ended and feed-in tariffs were substantially affected for those not on a grandfathered plan. What does this mean for the future of solar power in Australia? You can read an article on the Solar Citizens website entitled ‘Life After Feed-In Tariffs‘ which is very helpful.

Additionally, there have been myriad changes in July 2017 as the retailers update their pricing – while we’ll try to keep this list updated please double check with the retailers to get their most recent pricing options.

Regional Queensland, Victoria and Tasmania have regulated minimum tariffs – see those prices below and then we’ll compare them with the ‘market-set’ tariffs to see if the system is working. All prices are ex GST unless noted.

Regional Queensland

  • For the 2016-17 year, the regional feed-in tariff was 7.448 cents per kilowatt hour.
  • For the 2017-18 year, the regional feed-in tariff is 10.102 cents per kilowatt hour.

Victoria

  • For the 2016-17 year, the Victorian feed-in tariff was 5.0 cents per kilowatt hour.
  • For the 2017-18 year, the Victorian feed-in tariff is 11.3 cents per kilowatt hour.

Tasmania

  • For the 2016-17 year, the regional feed-in tariff was 6.671 cents per kilowatt hour.
  • For the 2017-18 year, the regional feed-in tariff is 8.929 cents per kilowatt hour.

South Australia, New South Wales, The Australian Capital Territory and South-East Queensland don’t currently have a regulated FiT; the government and regulators argue that the market will dictate these terms. Let’s have a look at how well it’s working:

South Australia

New South Wales

IPART (Independent Pricing and Regulatory Tribunal) advised in June 2017 that a ‘fair and reasonable’ value is between 11.9 – 15c / kWh. 

  • AGL offer 11.1c cents per kilowatt hour.
  • Lumo Energy offer 11.1 cents per kilowatt hour (effective July 25, 2017).
  • Energy Australia offer 12.5 cents per kilowatt hour.

ACT

  • Origin Energy offer between 9.0 and 17.0 cents per kilowatt hour.
  • Energy Australia offer 15.0 cents per kilowatt hour.
  • ActewAGL offer 11.0 cents per kilowatt hour.
  • Powerdirect offer 6.1 cents per kilowatt hour.

South-East Queensland

How to compare Feed-In Tariffs

The Australian Government have created a website, Energy Made Easy, where you’re able to compare energy offers from gas and electricity retailers. Click here to visit.

Do you have any information or questions about FiTs or do any of our prices need updating? Please leave a comment below and we’ll fix it up.

Want to shop around and don’t want to use the Energy Made Easy website? Here’s a list of the Energy retailers in Australia and their phone numbers:

Energy Retailer Phone Numbers
ActewAGL 131 293
AGL 131 245
Alinta Energy 133 702
Aurora Energy 1300 132 003
BlueNRG 1300 599 888
Click Energy 1800 775 929
CovaU 1300 026 828
Diamond Energy 1300 838 009
Dodo Power and Gas 133 636
EnergyAustralia 133 466
Energy Locals 1300 693 637
Ergon Energy 131 046
ERM Business Energy 134 376
Lumo Energy 1300 115 866
Momentum Energy 1300 662 778
Next Business Energy 1300 466 398
Origin Energy 132 461
Pacfic Hydro Retail 1800 010 648
Pooled Energy 1300 364 703
PowerDirect 1300 307 996
Powershop 1800 462 668
QEnergy 1300 448 535
Red Energy 131 806
Sanctuary Energy 1800 109 099
Simply Energy 138 808
WINenergy 1300 791 970

 

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