19 February 2014 — The Small-scale Renewable Energy Scheme will have zero impact on household power bills, according to an analysis released this week by the REC Agents Association, an industry body representing companies that trade in renewable energy certificates.
The analysis was released as speculation grows that the federal government intends to cut or wind back the Renewable Energy Target. This week the government appointed climate sceptic Dick Warburton to head the RET review, in a sign many say does not bode well for the future of renewable energy in Australia.
The cost of the SRES, which provides financial incentives for households to install solar panels and solar hot water systems, is expected to halve over the next two years to less than one per cent of a power bill. However, the RAA has said the reduction in wholesale electricity prices delivered by the renewable energy cancelled out any cost increase passed through to customers.
“This analysis destroys the myth that the Renewable Energy Target is a major driver of soaring power bills”, RAA president Ric Brazzale said. “The Renewable Energy Target is low cost and high achieving. It must be maintained to finish its job.”
“The Small-scale Renewable Energy Scheme deserves a gold medal”, Fiona O’Hehir, RAA vice-president said. “It has helped five million Australians cut their power bills by installing solar and has created 15,000 jobs and will do so at zero cost to households or the Federal Budget. That is an extraordinary achievement.”
Key findings from the RAA analysis were:
- The cost of the Renewable Energy Target that is passed through to residential customers currently amounts to a “modest” 1.12 cents per kilowatt hour or four per cent of the average residential electricity bill
- The cost of the SRES currently accounts for 0.54 cents per kWh or two per cent of a customer’s bill and is expected to more than halve over the next two years to account for less than one per cent
- The RET puts downward pressure on wholesale electricity prices and as a result wholesale prices are considerably lower than expected. The reduction in the wholesale price due to the RET is estimated to be 0.67 cents per kWh
- In the case of the SRES the reduction in the wholesale price cancels out the future cost increase that gets passed through to customers.
Read the full report at www.recagents.org.au