NSW slashes its solar feed-in tariffs

28 October 2010 – At yesterday’s annual sustainability forum held by the Royal Institution of Chartered Surveyors in Sydney, the audience heard that some residential real estate agents had noticed a price premium on house sales that had solar power.

It was the same day that the NSW Government decided to slash its gross solar feed-in tariff from 60 cents to 20 cents a kw hour.

Today’s newspapers have slammed the decision saying it will create bankruptcies and redundancies in the burgeoning industry amid fears the move will disillusion householders from their growing interest in sustainability.0

Greens Deputy Leader, Senator Christine Milne said the NSW Government’s decision, which took effect at midnight last night, was another reason for urgent introduction of a national scheme.

The Total Environment Centre took a softer line and commended the Keneally government for retaining the tariffs but urged a strong focus on energy efficiency.

Senator Milne said The Greens have a bill for a gross national feed-in tariff before the Senate. The bill would support investment in all forms of renewable energy at all scales.

“A feed-in tariff is regarded around the world as the most cost-effective way of supporting renewable energy,” Senator Milne said yesterday.

“What the NSW government has done today is just the latest knee-jerk government decision to subject Australia’s solar industry to a boom-bust cycle. How are people expected to have job security or investment security in these circumstances?

“It is ridiculous that every State and Territory has different mechanisms and tariffs for renewable energy and energy efficiency, leaving industry having to negotiate all these different policy settings. The federal government must adopt a uniform national framework.”

“A well-designed feed-in tariff alongside household energy efficiency measures can put downward pressures on energy bills by reducing electricity demand and reducing the need for more investment in energy network infrastructure.”

TEC executive director Jeff Angel commended the NSW Keneally government on retaining the gross feed-in tariff and not buckling to pressure from the fossil fuel industry but said the new low rate would need review.

The community’s proven appetite for renewables and clean energy should be encouraged, he said.

“Today’s action, however, will not curb the massive power price hikes coming down the line which are largely due to frivolous over-investment in the network system,” Mr Angel said.

“The national electricity market has tailored the system to meet peak power demands, and rewards power companies for spending more, and serving greater and greater demand.

“The best and cheapest answer to this out of control situation is energy efficiency,” he added.

“We strongly urge the NSW government to introduce energy savings targets on the distributors (poles and wires) and direct them to work where there is a constraint in the system and thus create excess capacity in the existing system.

“It’s been proven to work in other countries and we are far behind in the efficiency stakes,” said Mr. Angel.

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