Energy consumers are set to pay nearly $2 billion for rooftop solar installation subsidies next year, hiking power costs by up to $190 for every household, an expert analysis has found.
The federal government’s small-scale renewable energy scheme (SRES) — which the competition regulator wants wound down and abolished — will result in the cost of subsidies ballooning by 50 per cent to about $1.8 billion including GST in 2019, according to Sydney-based renewables trader Demand Manager.
The additional impost amid high electricity prices may accelerate calls for the scheme to be junked as new federal Energy Minister Angus Taylor comes under pressure to reduce household power bills.
The solar industry has previously called for the government to rule out ending the small-scale solar scheme, saying it would deprive households and businesses of their only means of lowering power bills.
But analysis of the cost of small-scale technology certificates, which are handed to consumers installing solar panels and then bought back by electricity retailers, shows a soaring cost to all power users.
About 30 million new certificates will be created this year and more than 36 million certificates are forecast to be supplied in 2019, the trader says. The “cost per household in Australia is in the order of $190 per household”, Demand Manager owner Jeff Bye said in a report released yesterday. “The SRES is effectively an uncapped program — the more solar installations, the higher the SRES program cost.”
A change to the solar subsidy may be imminent given the government’s focus on reducing power prices, Demand Manager told its clients in the report.
The government-run Clean Energy Regulator earlier this month released figures showing 1600 megawatts of small-scale solar capacity would be installed this year — a 44 per cent jump on 2017 — and the equivalent generation that Victoria’s Hazelwood coal plant supplied to the national grid before it was shut down.
Victoria’s push to have 650,000 owner-occupied households receive cheap rooftop solar over the next decade will add a further $1bn to the overall cost of the SRES subsidy over its lifespan, its analysis found.
Origin Energy revealed in August the government’s small-scale renewable energy scheme and state-based solar feed-in tariffs now accounted for up to 15 per cent of bill charges.