The Western Australia state government has announced that it intends to retroactively cut the feed-in tariff rate for around 75,000 solar homes. In a budget announcement, the Barnett government said it would halve the rate for those who installed a solar PV system and are now receiving 40c per kilowatt-hour (kWh). Australia’s solar industry and renewable energy campaigners have come out strongly against the government’s decision, saying that it is a breach of trust with the all the households that made the informed decision to go solar based on the incentive rate on offer at the time.
The government proposes first to cut the 40c/kWh rate to 30c/kWh from 1 October 2013, then to 20c/kWh from 1 July 2014. Those who are already receiving the 20c/kWh rate (i.e. solar households who entered into the scheme between 1 July 2011 and 31 July 2011) will not be affected by the proposed changes.
Whether the WA government will be able to implement the budget changes is not yet clear. A similar attempt by the NSW government to roll back Solar Bonus Scheme rates in May of 2011 was met with heated criticism and ultimately ended in failure.
The 40c/kWh was on offer to scheme applicants from 1 July 2010 until 30 June 2011. The WA Department of Finance website states that “customers accepted onto the Western Australian scheme receive payments for a period of 12 years”. Although the above does not specify the rate of those payments, it is clear that those who made the decision to invest in a system did not expect the rate to be reduced, and voices throughout the solar & renewable energy sectors share this sentiment.
John Grimes, CEO of the Australian Solar Council, slammed WA’s move in a media statement. “Today’s decision by the Barnett Government represents a significant sovereign risk if it is allowed to proceed. If this government contract can be ripped up without compensation, no WA Government contract is worth the paper it is written on. This move would set a very dangerous precedent.”
Kirsten Rose, Chief Executive for the Sustainable Energy Association (SEA), issued a similar statement. “Households were promised in writing that they would receive a set price for the electricity they exported for ten years. Now they will not even get a third of that. It’s a huge betrayal of public trust, and they have every right to be angry,” she said.
Dr Geoff Evans of solar energy political advocacy group Solar Citizens called the decision ‘outrageous’ in a media statement. “The WA Government is penalising solar owners for trying to save money and take back control over their power bills and is turning its back on people who are taking the right steps for our energy future,” he said. “It’s unfair to change the rules on people who have already made an investment on the assumption of policy stability, and the decision should be immediately repealed.”
Dr Evans encouraged solar system owners looking to “strengthen their voice in WA” to join the Solar Citizens campaign. The group has also started a petition to the government to reverse the decision.
© 2013 Solar Choice Pty Ltd
He is now the communications manager for energy technology startup SwitchDin, but remains an occasional contributor to the Solar Choice blog.
James lives in Newcastle in a house with a weird solar system.
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