Industry bodies disagree with IPART’s ‘fair and reasonable’ solar price

The Independent Pricing and Regulatory Tribunal’s (IPART’s) recommendations for solar power pricing have caused quite the industry stir.

Clean Energy Council Policy Director Russell Marsh said, “The industry disagrees with IPART’s assessment and believes that a ‘fair and reasonable’ price is significantly higher than what was recommended.

“Making the rate voluntary also opens the door to consumers receiving no payment at all,” Marsh added.

The IPART report was “effectively giving electricity providers a green light to offer less - or even nothing - for people who had installed solar panels”, Marsh said.

AuSES weighs in on the debate

The Australian Solar Energy Society (AuSES) said that IPART’s report confirms what it had been campaigning about: “Energy retailers are profiting from cheap solar fed back into the grid.” AuSES commended IPART for addressing what it calls “profiteering” on the part of energy retailers.

However, AuSES was at pains to point out that IPART’s recommendations are only the first step in the right direction and that there is “still a long way to go to secure a Fair Price for solar”.

“The report recommends a price of between 5.2 cents and10.3 cents per kilowatt hour, but this is just a guide and not mandated and falls well short of the real price for energy," said John Grimes, AuSES Chief Exective.

AuSES called on the NSW Government to set a mandatory Fair Price for solar energy generated by NSW households. The Clean Energy Council made the same request: “The government should reject the recommendations of the report immediately.”

IPART’s assessment

IPART’s assessment of a ‘fair and reasonable’ price for energy retailers to pay for solar energy generated by NSW households was in the range of 5.2 to 10.3 cents per kWh. IPART acknowledged some stakeholders’ expectations that the feed-in tariff be set at the same price as the electricity retail price - 20 to 30 c/kWh.

In response to this, it said, “Retailers do make a gain from their customers’ PV, but they only gain around 8.3 to 10.3 c/kWh for this electricity from regulated customers.”

IPART is only able to set a value for 2012/2013 once data becomes available - around June 2012. However, it does anticipate that the value will increase once carbon pricing comes into effect on 1 July 2012.

Acknowledging that it is difficult for households to find information on the feed-in tariffs that’s clear and concise, IPART also recommended that an annual benchmark range for feed-in tariffs be published to help both retailers and customers.

The tribunal said that customers will be able to use these resources to attract the best rate for their PV energy.

In the meantime …

While the debate continues, AuSES recommends householders with PV “shop around” to find retailers offering the best price for their PV energy using the IPART price comparison website: www.myenergyoffers.nsw.gov.au.