Solar panel installations in WA: Numbers steady, even without subsidies

If installation numbers are anything to go by, solar panels are still proving to be a worthwhile investment in Western Australia. The state continues to see a steady stream of solar PV systems go up onto rooftops even well after the generous feed-in tariff subsidies once on offer there were closed to new applicants at the beginning of August 2011.

Monthly solar system installation numbers in WA are still below what they were at the peak of state government’s incentive program, but are comparable to those of the pre-peak, subsidised era of WA solar power. The conclusions that might be drawn from this knowledge are that 1) solar power still makes economic sense in WA under current circumstances, and 2) adoption of solar PV amongst home and small businesses would be greater–and the solar industry doing better–if similarly generous incentives for solar power generation were still in place.

The main drivers behind the continued interest in solar panels in WA have been the rising price of electricity–which has skyrocketed by a whopping 69% since 2009–plus the falling cost of solar PV installations. The combination of these 2 factors means that it makes investment sense for the right homes and businesses to install a system–and many are doing so.

There are two separate, state-owned electricity grids in Western Australia: Synergy, which services Perth and the southwestern part of the state, and Horizon, which services its northern regions. Since WA’s 40c per kilowatt-hour (kWh) and 20c/kWh feed-in tariff rates were closed to new applicants, Synergy has been offering a rate of 7c/kWh to customers who install solar systems. As this rate is significantly lower than the cost of electricity purchased from utilities, it makes the most sense for solar homes and businesses to consume as much of their solar power as possible as it is being generated–that is, when the sun is shining. By contrast, a generous feed-in tariff would incentivise them to export their power to the electrical grid.

Over 1 of every 10 customers on the Synergy grid now have solar systems installed, according The West Australian, who spoke with the company’s chief executive, Trevor James. In total, this number is now about 112,000–up from a mere 8,000 in 2008. On average, 2,500 new installations are now going up every month. This trend is in keeping with the broader national one: Australia just hit the symbolic milestone of 1 million roofs with solar power. Solar panel installation numbers continue to grow, even in states whose subsidies have also been closed or reduced for new applicants.

Another trend that is observable across the country is a reduction in electricity demand–attributable at least in part to increased uptake of rooftop solar panels. Mr James admitted that the increase in solar system numbers has had an effect on the amount of business Synergy is doing. “The surge in demand for photovoltaic cells has contributed to a reduction in the level of energy sales in the (South West electricity grid) over the past couple of years,” he was quoted as saying in the newspaper article.

News of this growth is also in keeping with predictions that solar PV systems will play a major role in the future of Australia’s energy mix: BREE anticipates that solar power will be amongst the most affordable types of electricity by 2030. Additionally, the IEA sees it as a major part of the global energy mix by 2060.

© 2013 Solar Choice Pty Ltd

James Martin II