Victorian Government backs multiple time-of-use tariffs for rooftop solar

Victoria’s state government has backed the introduction of multiple time-of-use tariffs for rooftop solar exports to the grid to better reflect the value of the state’s distributed solar generation.

State energy minister Lily D’Ambrosio said on Wednesday the Andrews government had given the nod to multiple time-of-use solar FiTs ranging from peak, to off-peak and shoulder, which would better reflected current electricity pricing.

This would mean that solar households would be rewarded slightly more for their rooftop solar generation – up to 8c/kWh – if they sent it to the grid during peak periods.

The government also said that the minimum feed-in tariff – while yet to be determined by the state’s pricing regulator – was expected to go up 20 per cent, or from 5c/kWh to 6.5c/kWh, to better reflect their PV system’s environment value. it was reduced from 6c/kWh to 5c/kWh last year.

The decision follows the September findings of the final report from Victoria’s Essential Services Commission into the Energy Value of Distributed Generation.

Marking a first among Australian regulators, the ESC report concluded that the state’s current feed-in tariff design did not adequately reward the value of distributed energy generation on a number of levels.

It also said the tariff should be changed to factor in time of export, location of generator, and avoided greenhouse gas emissions – a finding it flagged in its draft report, published in May.

“Victorians should be fairly compensated for the power they generate – plain and simple,” D’Ambrosio said in a statement.

“Households will now be compensated through the most cost effective and fairest system available, which is through a time-of-use feed-in tariff.”

Part two of the ESC review will look at how investment in local distributed generation can reduce future costs of network poles and wires – and is expected to be tabled in February 2017.

A spokesperson for the state energy minister said that provided the report determined there was value added to the grid by distributed solar generation, then the expectation was that a further rise in the minimum feed-in tariff would be recommended. The ESC is expected to make its final pricing determinations early next year, in time for them to be applied on July 1, 2017.

This article was originally published on RenewEconomy sister site One Step Off The Grid. To sign up for the weekly newsletter, click here

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