REC Agents Association analysis: Renewable Energy Target helps reduce power bills for everyone

The solar industry has launched its campaign to save industry incentives by releasing a new analysis that demonstrates the cost of the those incentives on household bills is effectively zero.

The report conducted by the REC Agents Association (RAA) found that the cost added to bills for the certificates issued under the small scale Renewable Energy Scheme (SRES) is offset by the reduction in wholesale prices that is caused by the use of more rooftop solar PV modules and solar hot water systems.

The solar industry is facing a potential battle to retain the SRES because large utilities – who blame solar for reducing revenues and profits – want the component brought to an end. They will be lobbying heavily for such a move in the newly announced review of the renewable energy target.

The RAA says that according to figures from the Australian Energy Markets Commission, the cost of the SRES is expected to halve over the next two years to less than 1% of a power bill, or around 24c/kWh. However, this is more than offset by the estimated 27c/ kWh reduction that solar causes on the wholesale market.

“This analysis destroys the myth that the Renewable Energy Target is a major driver of soaring power bills”, said Ric Brazzale, President of RAA.

“The reduction in the wholesale price exceeds the cost pass-through on customer bills, which means that residential customers will be better off in future with the operation of the SRES,” the study says.

© 2014 Solar Choice Pty Ltd

Giles Parkinson

Giles Parkinson regularly contributes unique content to Solar Choice News. Giles is the founder and editor of clean energy industry news service RenewEconomy. He is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the founding editor of Climate Spectator.
Giles Parkinson