Thursday, May 08, 2008

Brumby government delivers a useless feed in tariff

What on earth is going on in the Victorian Cabinet?

After visiting the Bali convention on climate change and using their generous travel allowances to see how a good feed in tariff can promote emission reductions and jobs from solar power in countries like Germany, our Victorian Government has delivered a feed in tariff that is crippled and worthless.

It really is cynical greenwash, and follows the trend of them taking no real action to address climate change.

Who in the big end of town has guided them to such a poor outcome? They can't really be that stupid can they? Once again, politics delivers a very poor and non-transparent policy and legislation for the people, who expect so much more.

Read the letter below I sent to Cabinet for more details. And watch this video.


Dear Mr Batchelor,

Thanks for your late advice about the introduction of the new Feed in Tariff in Victoria further to my correspondence with your office on this matter on 19/3/08.

Unfortunately, I believe that the Government has made serious mistakes in the structure of this tariff, which almost completely negate the positive effects a well structured tariff would have.

My concerns are:

1. The Feed in Tariff is only paid on net metering.

The total electricity generated by panels should be subject to the tariff, as all the clean electricity generated has zero emissions which directly substitutes for coal-fired power and therefore reduces emissions accordingly.

In Germany and other locations where they pay the tariff on gross metering, there has been a dramatic rise in installation of solar power. Germany now has 400 times the solar output of Australia despite having about half our sunshine.

You have missed the opportunity to provide similar encouragement to a new economy and local industry (and jobs) based on increased installation of panels on available roof space.

2. The Feed in Tariff has a maximum ceiling of 2kW

This is nonsense. The more solar zero emissions power we generate as a nation the better. This is a critical measure for reducing our emissions to combat climate change. The 2kW array size limit for getting the Feed in Tariff is simply crippling the financial motivation for people to install solar panels, and crippling their payback if they choose to install a bigger array.

We currently have a 1.5kW array that has been running for 6 years and intend to expand it to 3kW. Your Feed In Tariff will provide us with no benefits.

Most five star standard households currently consume about 20 to 25kwH of electricity per day. A 1kW array produces about 5kwH per day, while a 2kW array produces about 10 kwH per day. Such systems will therefore export negligible net energy to the grid, particularly if a 2kW air conditioner is run on hot sunny days.

There is no rational reason to apply such a tariff ceiling; it should be removed.

3. No certainty for investment is provided

The complexities and restrictions of your feed in tariff resulting from net metering combined with the 2kW ceiling provide no certainty or guarantee for investment in a solar array, unlike gross metering with no ceiling which does. This is evident in countries like Germany where there has been significant investment in solar power - now the equivalent of two coal fired power stations, but with zero emissions.

The resultant lack of certainty for investment will greatly impede the uptake of solar power in Victoria.

4. Your Feed in Tariff is discriminatory.

The very few who may be lucky enough to benefit from your tariff will be those who can afford a 6 star house, relatively expensive efficient appliances and a 2kW array. By contrast, lower income less efficient households with a 1kW array and less efficient appliances will get no benefit. This is discriminatory.

In summary

Your assertion that the FIT "could pay off the cost of installation in less than 10 years" is incorrect. The combination of the 2kW ceiling and paying on net metering means very few, if any, will get any financial benefits from the tariff so it will be impossible for it to pay off the residual cost of solar panel installation after the rebate.

This scheme effectively does not deliver on Labor's 2006 election promise to introduce a workable feed in tariff due to its crippled nature.

Your tariff will not provide any incentive for leadership in Victoria in uptake of solar power or renewable energy initiatives.

Your tariff is not strategic and does not improve affordability of sustainable solar power. It will not empower Victorian households to take action on climate change.

I attended the rally at parliament today with 400 others to protest about the problems with your feed in tariff. I spoke to some of the many ETU members present who had expectations that the Brumby government would provide a feed in tariff that would stimulate local employment in clean energy energy industries. They feel you have let them down. I agree with them on this.

Your tariff has also not met the expectations of many local community groups who are very keen to see real government action on climate change. As such, it is a great disappointment.

I strongly urge you to adjust the tariff to remove the 2kW ceiling and use gross metering, so that Victoria can mirror the proven success of such tariffs where they have been implemented elsewhere and I understand will be implemented in the ACT.

As a reference, has many examples and much information about successful and implemented renewable energy policies, initiatives, and sustainable housing.

I would like to meet with you to discuss my concerns about this further.

Yours faithfully,

Peter Campbell

CC: Cabinet members and other MPs

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