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Most of Australia has had what are called 'FiT' or 'Feed in Tariff'. This was a price above and beyond the retail price of electricity that was paid for solar
by brc 14y ago
Most of Australia has had what are called 'FiT' or 'Feed in Tariff'. This was a price above and beyond the retail price of electricity that was paid for solar panel owners.
It varies state to state, but was up to 44c kwh.
However, because of the fact that these schemes blew out in cost (original estimates in NSW were about $1.6b in total, but ended up something like $6b per year) - principally because of the same analysis as the parent comment - 'hey ! free money!' - the schemes are being wound back agressively and closed to new entrants. In most cases, they have been trimmed back to pay the wholesale cost of electricity if your house is a net producer.
The perverse incentives meant that many people would turn everything off during the day, and then switch it all on again as soon as the solar panels stopped producing power. So daytime usage would end up exporting maximum power to the grid, while nighttime usage would climb as homeowners used power-hungry appliances like clothes dryers after dark.
The end result is that a lot of small businesses that started up will now close in a classic boom-bust cycle that could have been prevented.
In case it's not clear, I have a very real moral problem with subsidised solar power. Nobody would float the idea of a law that meant bus prices were increased to pay rebates to owners of a Mercedes, but effectively that is what solar FIT regimes do. They increase the cost of energy for people who cannot afford a solar panel install (those in rented accomodation, or in multi-unit dwellings) to benefit those who have their own house and the spare capital to spend on solar panels.
- anthonyb 14y ago$6b is not so bad when you consider that coal subsidies are in about the same ballpark: http://www.couriermail.com.au/business/coal-and-gas-paid-7b-in-subsidies/story-fn7kjcme-1226301312395 http://www.couriermail.com.au/business/coal-and-gas-paid-7b-... And there's no moral problem. To paraphrase Winston Churchill - you're just haggling over the price.
- rimantas 14y agoAnd the amount of energy produced is in the same ballpark too?
- anthonyb 14y agoWe're talking cost per kWhr, so yes, per kWhr. The issue is that coal is quoted at 10c/kWhr, solar at a higher rate, but that neglects subsidies and negative externalities like climate change. Once you balance the subsidies and introduce a carbon price, coal starts to look a lot worse.
- brc 14y agoanthonyb - the article is not clear on what the subsidies were. It also doesn't factor in the royalties that developed fields will produce. So I can't really determine that. However, in nearly every case where I see 'x industry gets y billion' in subsidies, the numbers are usually things like tax rebates on R&D, which apply to every industry, including software, and, in Australia particularly, the off-road diesel fuel excise rebate, which is not a subsidy but merely a refunded tax because diesel excise is for investing in the road network. Again, many industries receive a diesel excise exemption, including fishing and agriculture. Whereas most 'renewable' industry subsidies are direct payments.
- anthonyb 14y agoIt is a bit light on detail, but still there are significant subsidies which are paid to the oil, coal and gas industries. There are some fairly detailed numbers released by the Greens: http://nonewcoal.greens.org.au/coal/speeches http://nonewcoal.greens.org.au/coal/speeches The basic gist is that solar gets ~1/20th of the subsidy that coal does. All of that overlooks the built in subsidies though, namely that fossil fuel power plants can dump pretty much whatever they want into the atmosphere. The health impacts of that alone are immense, and there's no other industry which gets away with that.