Darwin Solar – What’s Going On?

As Australia’s sunniest capital (Darwin gets more sunlight year-round than any other major city – an average of nine hours every day), Darwin solar is certainly in the doldrums. As per the Australian PV Institute, the entire Northern Territory’s PV solar output as of January 2017 was a mere 4,049MWh (the lowest in Australia, less than Tasmania, and a ridiculous amount behind state leader Queensland who output 126,629MWh that month). What’s wrong with solar power in the Northern Territory, its capital Darwin, and what can be done to fix it?

Darwin Solar – the situation

According to the Australian Energy Council‘s latest report, residents of the Northern Territory are paying the second highest for electricity in the country, behind Tasmania. The ABC website quotes John Grimes of the Australian Solar Council that a third of homes (freestanding) in QLD and SA have PV solar installed on their roof, but this number is only 11% in the Northern Territory.

Darwin Solar - Australian Solar Installs 2016
Darwin Solar lagging behind in Australian Solar Installs for 2016 (source: abc.net.au)

The Northern Territory has a renewable target, which is to reach 50% renewable energy by 2030 – so it’s obvious that something needs to give if they’re going to get anywhere close to that. ABC quote an adviser to the NT Government, Alan Langworthy, who notes that the number of solar installations in the area is “artificially low” – noting that 40% of occupants in Darwin are renters, and as solar power for renters is still a tricky and mostly unexplored topic, it makes sense there will be less solar installations.

“Having a very high transient [and] rental population in the NT tends to have driven down enthusiasm in rooftop photovoltaics,” Langworthy said.

Also to note is that solar panels need to be signed off by a building certifier, which adds ~$900 to the cost of each installation. Perhaps another reason uptake has been slow is that back in 2011 when states were offering high tariffs to incentivise initial uptake, the gov’t offered 19.23c/KwH to feed back into the grid – in comparison to 44c/kWh in WA and QLD, or 60c/kWh like Victoria.

Perhaps the answer is for the government to consider some sort of subsidisation scheme or generous tariff for residential solar – maybe something targeted specifically to landlords could be a step in the right direction.

We will see what the NT have in store when they release their policy on how they plan to reach the 50% renewable energy target.

It’s not all doom and gloom for the area, however – Alice Springs solar has been boosted by the $8.3m BESS (Battery Energy Storage System) which Vector Energy will be installing by late 2017 to help improve the reliability of base-load power for Territorians. We’ll wait and see what impact this has on Northern Territory solar and which steps they take in order to try and reach their Renewable Energy Target.

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2017 NSW Tariff-Tracking Report released.

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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QLD Solar Feed-In Tariff to stay

After the deregulation of south-east QLD electricity prices last July more than 200,000 households on the grandfathered $0.44c solar feed-in tariff will keep the incentive until 2028 – despite the Productivity Commission advising against it whilst also calling for the deregulated prices . The Commission’s report advised that this will cost Queensland taxpayers $3 billion over the next ten years, and $1.4 billion more already incurred. But the legalities around the contract are water tight and those smart enough to take up solar energy during those times deserve what was offered to them by the government.

QLD Solar Feed-In Tariff
QLD Solar Feed-In Tariff to stay.

Solar Feed-In Tariff History

Anna Bligh’s government passed the 44c/kWh feed-in tariff in 2009 and it was eventually restricted in 2012. According to the Queensland Competition Authority, regional electricity price raises (7-8%) are a direct result of the ‘substantial increase’ in wholesale energy costs. These costs have undoubtedly been affected by the FIT, which will result in $770m over the next three years.

Matthew Warren, CE of the Australian Energy Council said the removal of the Solar Bonus scheme from electricity network charges would represent a fairer situation for residents and businesses in Queensland.

“Previously all energy consumers have subsidised those who have put solar panel on their rooftops through higher electricity prices – we would urge the Queensland government to make the change permanent to avoid any future bill shock.”

Curtis Pitt (QLD Treasurer) was quoted as saying the Palaszczuk government will not abandon the solar bonus legislation, introduced by the former Bligh Labor government to facilitate rapid uptake of rooftop solar panels, which it certainly succeeded in doing. “We want to give people the certainty that that is going to remain in place,” he said. “I believe your word is your bond. We’d like to think we’re a government that is going to keep its election commitments and our election commitments were that was going to be maintained.”

Let’s hope they stick to their word.

Read more about Queensland Solar.

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