Yesterday, the Federal Government abruptly ended the means-tested solar rebate scheme which gave households a strong incentive to buy rooftop solar energy systems.

Industry had known the current system was seen by the government as unsustainable, but as is often the case with decisions related to the solar industry, we were given little notice — in yesterday’s case, literally a few hours — before the change took place.

This kind of jumpy policy-making makes it extremely difficult for the solar industry to know where it stands and provide certainty to the thousands of people it employs.

The rebate scheme was criticised by some as being too generous and has now been replaced by a less expensive solar credits system.

Both these initiatives provide a short-term incentive for people to put an energy system on top of their house, but don’t properly tap into the real benefits of solar or provide industry with the direction needed to stimulate growth and local investment.

Australia’s glaring inability to see the success of overseas Gross Feed-in Tariff (GFiT) models to encourage solar use is concerning. These schemes are essentially an ongoing payment to homeowners who have installed rooftop solar energy systems (or any type of renewable energy system) which are connected to the main electricity grid.

Homeowners receive a payment — typically, around 60 cents per kilowatt hour, or four times the price of coal-fired electricity — for the power produced by their system. The bigger the system, the more power is produced and the bigger the GFIT payment.

Globally, GFiT schemes have encouraged millions of people to install renewable energy systems and do their bit to slow global warming. Various tariffs and incentives operate in parts of Australia (the ACT is the only state or territory that has adopted a GFiT) but we still wait for a national, consistent GFiT scheme.

Germany’s GFiT program has created nearly 250,000 new jobs in renewable energy; the sector will soon overtake Germany’s car industry as the nation’s number one employer. And Germany only gets half as much sunshine as Australia.

We’re blessed with the highest average solar radiation of any continent — a free, endless source of power. Yet despite this natural advantage, Germany produces 200 times more solar energy than Australia does.

Concerns that it will raise energy prices for all consumers (to pay for the GFiT) are exaggerated; you can expect a one-off, sub-CPI rise. Claims that households will be hundreds of dollars a year worse off are nonsense.

Less than ten per cent of Australia’s energy currently comes from renewable sources; given that we won’t be damming our precious rivers to produce hydroelectric power — and nobody really expects to see wind turbines in every backyard alongside the Hills Hoists — solar really is the best way to go.

It also means we don’t have to wait for large-scale renewable energy developments; every Australian can turn their home into a clean, green power station and do their bit for the environment. At the same time, it’ll generate investment that will produce thousands of new, “green collar” jobs and renewable energy expertise right here at home.

The government needs to show that it is serious about the Australian solar industry by seriously considering implementing a proven GFiT scheme.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey

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