At the end of this month The Victorian Government will introduce a scheme whereby solar incentives will be slashed. This reduction will be in the form of cuts to the ‘p-fit’ which stands for premium feed in tariff. The feed in tariff refers to the dollar amount given back to people with solar systems that produce excess energy than consumed. Up until the end of this month there was much greater incentive to have a solar system because energy produced but not used by the system would give the homeowner 60c per kilowatt hours back. With the cuts to the p-fit, this return rate will only be around 25c per kilowatt hours depending on the energy retailer.
What does this mean for the future of the solar industry, and even more
broadly the future of the renewable/sustainable energy sector?
The Victorian Government
argue that the rate reduction from 60 cents to 25 cents is due to the decreased
cost of solar panels, leading to a reduced need for incentives. Even under the
new p-fit scheme, solar customers will still have a pay-back period of less
than ten years.
I argue that the need for
incentives is increased not reduced. Only households from high income brackets
can afford to have solar installations and almost none of the industry or
commercial sector have a sustainable energy source due to the huge expense
involved. At a time when sustainable energy solutions need to be made the most
economically viable and available opportunities we see our Government
counter-acting what our Society is working towards.
By: DERMOT REITER
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