How will changed solar rules affect power prices and supply?

Peter Terlato 10 January 2017

solar energy money Australia cost

Killing off rebates could raise energy bills by 40% to 200%.

From the beginning of January, the federal government began phasing out Australia's solar energy tariff rebates, raising the likelihood of bill shock for hundreds of thousands of homeowners.

But exactly how will Aussies be affected by changes to the regulations surrounding solar energy?

The national solar rebate will reduce by about 7% each year until 2030 when it is officially retired.

For example, this year the $3,840 rebate that most Aussies receive for a 5 kilowatt rooftop solar system has fallen around $260, slipping to $3,580. In 2018, the annual rebate will drop to approximately $3,320.

The NSW government's decision to wind up the state's solar bonus scheme at the conclusion of 2016 will likely play a part in increased bill costs and demands for alternative power sources.

Energy solutions provider Natural Solar says changes to federal and state rebate programs has encouraged a 672% rise in demand for home battery storage in the past month.

Natural Solar is a certified installer of the Tesla Powerwall, a lithium-ion battery charged by solar energy.

The discontinuation of rebates is anticipated to raise energy bills by 40-200%. Some households are expected to shift from a credit of a few hundred dollars to a quarterly bill of between $5-$800.

The majority (72%) of enquiries into alternate energy sources, such as home battery systems, came from NSW customers, expected to be hit hardest by the changes.

Victoria's premium feed-in tariff for solar energy will continue to run until 2024 but the state's transitional feed-in tariff concluded at the end of 2016.

Installation broker Solar Choice says some Victorian households are seeking energy storage to avoid "wasting their solar energy" by exporting to the grid at new, presumably low rates.

For this reason, the Australian Energy Market Operator (AEMO) suggests Victoria will be the second largest potential market for energy storage in Australia after NSW.

Energy storage may become financially attractive to Tasmanian solar-producing homes once they lose transitional benefits at the end of 2018.

StateSolar feed-in tariffs ends
NSW31 December 2016
Queensland1 July 2028
South Australia30 June 2028
Victoria31 December 2016
Western Australia10 years after installation
Tasmania31 December 2018
ACT20 years after installation
NTN/A

Electricity bills across Australia are expected to rise in every state, aside from Queensland and Tasmania, over the next two years, according to the Australian Energy Market Commission's (AEMC) latest report.

In November we reported household debt for electricity and gas bills had fallen, with fewer Australians on payment plans and more households completing hardship programs to avoid disconnection.

Use our comprehensive guide to compare and contrast different offers from a variety of energy suppliers.

We've also got tips to help you properly read your energy bill and understand the fees you encounter.

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