South Australia’s minimum solar feed-in tariff could be nixed under ESCOSA proposal

Rooftop solar households in South Australia face losing the 6.8c/kWh feed-in tariff after the state pricing regulator revealed it was working on a draft proposal to remove the minimum retail price for solar exports, starting January 2017.

In a media release on its website, the Essential Services Commission of South Australia (ESCOSA) said its proposal to remove the minimum FiT was “based on the view that the market structures that facilitate electricity retail competition are sound and that continued regulation of the minimum R-FiT may inhibit competition in the future, to the detriment of consumers.”

The Commission also said that removing the minimum R-FiT did not necessarily mean retailers would no longer pay it.

“Evidence from other jurisdictions strongly suggests that customers will continue to receive an R-FiT set by retailers, reflecting the long term benefit that retailers receive from energy exported by solar customers,” it said.

But the decision comes at a time where consumer confidence in the function of the state’s electricity market is at an all-time low – an unfortunate irony that advocacy group Solar Citizens is keen to highlight.

“When electricity prices in South Australia have only just last month risen by 10 per cent, it’s incredible that the regulator now thinks a fair price for solar households is effectively zero cents,” said Solar Citizens national director Claire O’Rourke in an statement on Thursday.

“Either the ESCOSA has a real lack of understanding in the South Australian electricity market or an incredibly short memory. It is the lack of competition in the South Australian electricity market that has been widely identified as a major reason behind recent wholesale price spikes,” she said.

“The decision …ignores the huge value of rooftop solar in South Australia that has helped provide reliable, cheaper electricity and reduce the price of electricity for all South Australians.

“If we want to encourage a smarter way of generating cheaper energy, we should be valuing solar electricity. Solar power, especially when coupled with battery storage, can provide the solution for higher electricity prices.”

© 2016 Solar Choice Pty Ltd