Feed-in tariffs in Australia are the feed-in tariffs (FITs) paid under various State schemes to non-commercial producers of electricity generated by solar photovoltaic (PV) systems using solar panels. They are a way of subsidising and encouraging uptake of renewable energy and in Australia have been enacted at the State level, in conjunction with a federal mandatory renewable energy target.
Australian FIT schemes tend to focus on providing support to solar PV particularly in the residential context, and project limits on installed capacity (such as 10 kW in NSW) mean effectively that FITs do not support large scale projects such as wind farms or solar thermal power stations.
Gross vs. net FIT schemes Some schemes are based on a gross feed-in tariff model while most are based on a net tariff.
Net feed-in tariff schemes have been criticised for not providing enough incentive for households to install solar panels and thus for not effectively encouraging the uptake of solar PV. They have been described as a "fake feed-in tariff". Critics of net FIT argue that gross tariffs conform to the normal definition of a feed-in tariff, and provide a more certain financial return, paying for all electricity produced, even if it is consumed by the producer, reducing or helping meet peak demand. The issue still remains as to what level the FIT rate should be set – e.g., at the cost of production, at market rates, at the cost at which the retailer sells electricity, or at the rate at which the retailer can acquire electricity in the wholesale market, while others set them at premium or subsidy levels.
The effective difference is that household producers under a gross scheme pay for electricity from the electricity retailer for household consumption at the market rate while all the power produced by them is sold to the retailer at the higher subsided FIT rate. Net FIT schemes effectively use the same rate for the use of electricity by household producers as for sale into the grid (i.e., use of electricity by the household reduces the amount of electricity available to feed into the grid), and accordingly the subsidy to household producers is generally less in overall terms.
The ACT and New South Wales had gross feed-in tariffs, which were subsequently replaced with net feed-in tariffs.
Proposed federal gross feed-in tariff scheme A uniform federal scheme to supersede all State schemes has been proposed by Tasmanian Greens Senator Christine Milne, but not enacted. National feed-in tariff systems have been enacted in numerous countries including Brazil, Canada, China and many EU countries.Dr James Prest Submission to Senate Inquiry into Feed-in Bill 2008 . Senate Standing Committee on Environment, Communications and the Arts.Ray Block (28 April 2009). Feed-in Tariff (FIT) and the fallout in the solar PV market . Block’s Indicator of Sustainable Growth.
The Federal Parliament has not yet enacted a national gross feed-in tariff scheme for renewable energy. However, a capital grant/rebate was offered of up to $8,000 per household for domestic installations and 50% for school installations up until June 2009.Solar Homes and Communities Plan . Department of Environment, Water, Heritage and the Arts.
In July 2008, a bill was introduced by Australian Greens Senator Christine Milne, (Tasmania), called the Renewable Energy (Electricity) Amendment (Feed-In Tariff) Bill 2008. The bill was the subject of an inquiry by the Senate Standing Committee on Environment, Communications and the Arts.
More than 23,000 people have signed an online petition for a national gross feed-in tariff.feedintariff.com.au. An Energy Matters community initiative.
In a speech, the Federal Minister for Energy, Martin Ferguson, said that feed-in tariffs are technologically prescriptive and ideologically based, rather than being a market based mechanism. In response to the German feed-in tariff for solar, he suggested that Germany's solar subsidy meant German consumers paid more than €1 billion in additional power bills in 2007 to generate around 0.5% of Germany's gross electricity consumption, suggesting that the policy does not deliver value for money. He also suggested that an Australian solar feed-in tariff may lead to greater PV panel imports rather than a significant expansion of Australian production.Solar Flagships Forum The Hon Martin Ferguson AM MP However commentators have suggested that Martin Ferguson's comments are ideologically driven and do not take into account the Merit Order Effect which in some instance negates or almost negates the cost of funding FiTs and in other instances shows funding FiTs delivers a net dividend to consumers.
State government feed-in tariff schemes State Current status Max Size Rate Paid Program Duration ModelSolar feed-in tariff meets with mixed reviews Only "Gross" conforms to the normal definition of a feed-in tariff. VIC - Premium Nov 2009 to Sep 2011 - Closed on 29 December 2011 5 kW 60c/kWh 15 years NetSolar feed-in Closed scheme VIC VIC Government. Retrieved 1 February 2013. VIC - Transitional Closed on 31 Dec 2012 5 kW 25c/kWh until 31 Dec 2016 Net VIC - Standard Closed on 31 Dec 2012 < 100 kW 1 to 1 (@ retail tariff rate) until 31 Dec 2016 Net VIC - closed 1 January 2013 – 31 Dec 2015 < 100 kW 6.2c/kWh until 31 Dec 2015 Net VIC - Closed 1 January 2016 – 30 Jun 2017 < 100 kW 5c/kWh N/A Net VIC - Current Commenced 1 July 2017 < 100 kW 3.3c/kWh N/A Net SA - grp 1 Approved before 31 August 2010Installed before 29 January 2012 - Closed 10 kW 44c+/kWh until 30 June 2028 NetSolar feed-in scheme SA SA Government. Retrieved 1 February 2013. SA - grp 2 Approved between 1 September 2010 and 30 September 2011Installed before 30 September 2011 - Closed 10 kW (max 45kWh/day) 44c+/kWh until 30 June 2028 Net SA - grp 3 Approved between 1 September 2010 and 30 September 2011Installed before 1 October 2011 (+ 120 days) - Closed 10 kW (max 45kWh/day) 44c+/kWh until 30 June 2028 Net SA - grp 4 Approved between 1 October 2011 and 30 September 2013To be installed before 1 October 2013 (+ 120 days) 10 kW (max 45kWh/day) 16c/kWh + Minimum Retailer Payment (MRP)(MRP: 1 July 2012 to 30 June 2013: 9.8c/kWh)(MRP: 1 July 2013 to 30 June 2014: 11.2c/kWh) until 30 September 2016 Net SA - grp 5 Approved after 30 September 2013 N/A 0c (eligible to receive a minimum retailer payment) N/A Net ACT Approved between March 2009 - 30 June 2013 30 kW 50.05c/kWh up to 10 kW capacity (until 30 June 2010); 40.04c/kWh 10 kW to 30 kW capacity (until 30 June 2010); 45.7c/kWh up to 30 kW (from 1 July 2010) 20 years Gross ACT Commenced July 2013 10 kW 7.5c/kWh up to 10 kW capacity 20 years NetSolar feed-in scheme ACT ACT Government. Retrieved 13 June 2013. TAS Commenced under 10 kW over 10 kW tbc 1 to 1buyback rate Aurora Energy. Retrieved 27 February 2013.(@ retail tariff rate from Aurora Energy = 27.785c/kWhResidential rate Aurora Energy. Retrieved 27 February 2013.) tbc Gross NT ClosedIncentive is available for 225 rooftop PV systems in Alice Springs. tbc 45.76 c/kWh. Capped at $5 per day, then reverts to 23.11c per kWh. tbc Net NT ClosedValid from 1 July to 31 December 2012 4.5 kW 21.77 c/kWh (Domestic customers <10kVA) tbc Net NT Valid from 1 January to 30 June 2013 4.5 kW 27.87 c/kWh (Domestic customers <10kVA) Capped at $5 per day, then reverts to 23.11c per kWh. tbc Net WASynergy Supply Closed on 1 August 2011 5 kW 47c/kWh (from 1 August 2010)REBS and Net Feed in Tariff Price Schedule . Synergy Supply. Retrieved 12 January 2012.40cents (between 1 July – 9 Dec 2011)Feed in Tariff WA . WA Government. Retrieved 27 February 2013.20cents (from 10 Dec 2011)Buyback excess electricity rate 8.4094c (also after 1 August 2011)Buyback rate WA. Synergy. Retrieved 27 February 2013. 47c/kWh@10 years NetGrid-Connected Small Scale Renewable Energy Systems Synergy Supply. Retrieved 12 January 2012. WAHorizon Power Supply Closed on 1 August 2011 30 kW 58.93c/kWh (from 1 August 2010) Buyback excess electricity rate range from 10 - 50c/kWh (also after 1 August 2011)Buyback rate WA . Horizon. Retrieved 27 February 2013. 58.93c/kWh@10 years Net QLD Commenced in July 2008, changed on 25 June 2012,closed 1 July 2014. From 2008: 30 kW; 7 June '11: 5 kW 44 c/kWh: Applications received by 9 July 2012 and installed by 30 June 2013;8 c/kWh: Applications after 9 July 2012, expired 30 June 2014 44 c/kWh: Until 1 July 2028; 8 c/kWh: Until 30 June 2014 NetSolar Bonus Scheme QLD Government. Retrieved 21 December 2018. NSW Closed 10 kW 20c from 28 October 2010 (Prev 60c (From 1 July 2010. 66c)) 7 years for 60c tariff GrossReference:Feed-in tariff for grid-connected solar power systems. Energy Matters. Retrieved 12 January 2012.
Australian Capital Territory
Under the Electricity Feed-in (Renewable Energy Premium) Act 2008, Canberrans can install photovoltaic (solar) cells or other renewable sources, produce their own energy, and sell it back to the power grid but perhaps not until July 2009. They'll be paid a tariff 3.88 times the retail cost of electricity (60c/kWh Jan 2009) for the energy they feed back into the electrical grid for up to 20 years from the date they sign up to the scheme.Electricity Feed-in (Renewable Energy Premium) Act 2008 It is a gross metered scheme meaning that owners get paid a premium rate for all electricity produced by their installation with their own usage being metered separately. The ACT scheme will be the most generous feed in scheme in Australia when it comes into operation some time after March 2009.
As the Australian Capital Territory ("ACT") scheme is a gross feed in scheme, it is a relatively easy task to estimate the payback time for various system sizes because the calculation is independent of electricity consumption. e.g. a well positioned location in the ACT could produce approximately 1800 kWh per year from a 1 kW system or A$1,080 per year at a price of 60 c/kWh. On this basis payback for a 1 kW system costing $5,000 net (includes $8,000 federal rebate & 22 RECS) would be around 5 years. Larger systems would take longer but would have a larger income stream over the life of the system.
The ACT Government established an inter-departmental committee to look at feed in tariffs in November 2007.(15 November 2007). ACT considers a renewable energy feed-in tariff . ElectricalSolutions. Westwick-Farrow. Retrieved 12 January 2012. There is some concern that a proposed commercial solar power plant, the feasibility of which is to be examined by a joint study be ACT government and ActewAGL,(8 May 2008). Mixed reaction to solar power plan. ABC News. Australian Broadcasting Corporation. Retrieved 12 January 2012. may undermine the proposed feed in tariff proposal.
The submission of the Independent Competition and Regulatory Commission 25 February 2008 was that there were issues to be resolved including: overall effectiveness and efficiency cross-subsidy elements equity issues particularly for households suffering financial hardship a gross or net approach is adopted a clearly predefined finite life (no more than 5 years); a partial subsidy rather than full cost recovery ability to terminate if national policies are introduced e.g. carbon tax transparency of tariff settingFeed-In Tariff Discussion Paper — Comments February 2008 ACT Govt Independent Competition and Regulatory Commission
On the grounds that a capacity cap of 30MW had been reached, the FIT scheme in the ACT was closed to micro and medium scale generators at midnight on 13 July 2011 just days after the legislation was amended (by the Greens and Liberal parties voting together against the will of the government Labor party) on 12 July 2011 to enable micro-generators to continue to access it. The micro-generator category under the Act had earlier been closed on 31 May 2011 once a statutory cap of 15 MW had been reached.
South Australia