by Tina Perinotto

Comment (and fact sheet)- 12 November 2009 –
NSW may yet become a leader again, with the Premier, Nathan Rees on Tuesday announcing a gross feed in tariff for solar energy installations that could pay householders up to $10,000 over a seven year period.

The scheme would place the State’s policy on solar energy for households on the same footing as the ACT’s, which also pays a gross feed in tariff – or, a price for all energy produced, not just the “net” or excess energy produced, such as elsewhere in Australia.

If the promise goes ahead as outlined and does not disappear in the press release dungeon of countless other failed promises  it has the potential to re-ignite the competitive spirit that can achieve rapid take up of a green economy across the entire country.

At the Intelligent Grid Forum in Sydney yesterday, delegates seemed genuinely optimistic at the news.

A solar energy system that works efficiently and can supply all energy for an average household would make huge inroads into the battle to reduce energy demand, and thereby the need for more power station capacity, whether coal or gas fired.

It would also help heal the wounds of betrayal of all those early adopters who paid top prices to install solar hot water systems only to find their energy bills rising because of poorly configured technology or by energy companies removing off peak allowances.

A statement issued by Mr Rees, said, in part:

“These changes will see an average family paid around $1496 a year. “That’s a 62 percent increase on the previous scheme and means households can pay off their investment in solar panels in around eight years.

“Under our scheme, homeowners will know up-front how much they will be paid for all the energy their solar panels produce.

“Households with solar panels will be paid 60 cents per kilowatt hour and an average household system would generate annually around 2500 kWh.

“Creating certainty in the feed-in-tariff scheme is one way we can encourage families to invest in solar technology and support the clean energy industry.

“A review of the scheme was one of the first tasks for the newly created Ministerial portfolio of Climate Change, Environment and Energy. Minister John Robertson will introduce legislation for the scheme into parliament this week.”

Mr Rees said the scheme was proposed to run for seven years.

FACTSHEET – NSW Solar Bonus Scheme

The Gross Feed-in Tariff

The NSW Government has announced a “gross” Feed-in Tariff for NSW households with solar panels commencing January 1, 2010.

NSW’s Solar Bonus Scheme will now deliver the highest payments to families of anywhere in the country.

Under a Gross Feed-in Tariff households will be paid for every single kilowatt hour of energy they generate instead being paid only for what they don’t use.

NSW current solar capacity

As at August 2009, there were 10,476 PV systems installed within NSW, providing a total generation capacity of just over 13MW. Of these, 8371 or 80 per cent are connected to the electricity grid.

There have been significant increases in the number of PV systems installed in NSW, with near exponential growth since mid-2007.

Eligible technology

Solar photovoltaic systems up to 10 kilowatts in size will be eligible for the NSW Gross Feedin Tariff. A standard solar system is around 1.5kW and can generate around 2500kWh of solar energy a year.

Wind turbines up to 10kW will also be eligible to be paid the Feed-in Tariff. The tariff will be payable to small retail customers (whose electricity consumption does not exceed 160 megawatt-hours of electricity per annum).

Average payments

Under the new Solar Bonus Scheme a household with a standard solar system will be paid around $1500 a year for the clean energy they generate.

At this rate the payback period on a standard solar system will be just over 8 years.

The scheme will be capped at a 10kW system which would generate around 16,700 kWh a year and pay out close to $10,000 under the Government’s new gross feed in tariff.

PV system capital costs

The average cost per KW of a PV system is $12,500. The actual price paid by customers is significantly less when Government rebates and subsidies are taken into account.

Over the last two decades, the cost of manufacturing and installing a photovoltaic solar power system has decreased by about 20 per cent with every doubling of installed capacity.

Solar PV costs are expected to continue to decrease. PV cost reductions in excess of 50 per cent from 2007 levels have been predicted. Industry experts have suggested that within three to seven years, solar energy’s unsubsidised cost to consumers could approach the cost of conventional electricity in a number of markets.

Take up rates

Early figures suggest around 10,000 NSW households are likely to install solar panels in the first year of the scheme and over 60,000 units will be installed over the full seven years.

Clean energy jobs

This huge increase in investment in renewable energy will support more than 500 new clean energy jobs across the state in its first year alone.

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