Moves to limit solar power's silver lining

Solar-powered households could be forced on to time-of-use tariffs, which would limit the bonus residents receive from selling power to the grid. Source: The Courier-Mail

SOLAR-powered households could be forced on to time-of-use tariffs to ensure they pay their share of network charges.

A report ordered by the Newman Government has recommended the highly-controversial move after finding the current solar schemes were hurting lower income households.

The report found that by 2015/16, the cost passed on to all electricity users from paying for home-produced solar power would drive up the average annual power bill by $276, or about 17 per cent.

"When those doing the paying are likely those least able to afford it and those enjoying the benefits are those likely to be most able to afford to meet their true costs, then something is truly wrong," the Queensland Competition Authority report said.

Industry insiders are convinced thousands of solar households maximize the benefit of the 44-cent feed-in tariff they receive by selling all the power they produce during the day and using only grid-produced power at night.

This way they received 44 cents per kWh for the solar power they produce while paying the retail rate of about 23 cents per kWh for what they use.

The QCA report found one way to reduce the impost being passed on to other consumers would be to switch solar households to the time-of-use tariff, which is currently voluntary.

Time-of-use tariffs offer off-peak price discounts but make power more expensive at night when there is increased demand.

"In this regard, it would go some way to reducing the problem of PV customers avoiding a portion of the true cost of their network access due to their net consumption profile, which leads to higher average variable network charges," the QCA said.

The Government has repeatedly promised to continue paying the 44 cent feed-in tariff but last year cut off the scheme to new participants.

Other QCA recommendations included:

* Making electricity retailers, rather than Government-owned distributors, pay for household-produced power.

* Creating a competitive market for household solar power in the southeast and establishing regulated price of between 7 and 14 cents per kWh throughout regional Queensland.

* Introducing mandatory retailer contributions that reflect the direct benefit they get from onselling solar power.

* Transferring the costs of the solar feed-in tariffs from the distributors to the Government.

Energy Minister Mark McArdle has this afternoon reconfirmed the Government commitment to the 44 cent feed-in tariff but will consider the report's recommendations.

"It is important that any response reflects the long-term direction the Newman Government is proposing for the electricity industry," he said.

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Newman powers up electricity subsidy

Date/Time: 2013:02:22 20:27:20 Source: The Courier-Mail

PREMIER Campbell Newman has indicated his government will move to subsidise household power bills, to protect Queenslanders from a 21.4 per cent electricity price hike.

The Queensland Competition Authority yesterday released its determination for a double-digit increase based on higher network costs, subsidising solar power users and last year's freeze on the standard tariff.

Although Mr Newman acknowledged his price freeze was a "component'' of what the QCA was putting forward, he described the increases as "unacceptable''.

"What I do say today, is that the government will act to make sure people aren't hit with a double-digit increase,'' said the Premier.

"The government might have to subsidise it, in fact probably will have to subsidise it, but we're determined to find a way to ensure people don't get hit with a double-digit increase."

He said it was too early to talk about the cost of subsidising power bills, or who might benefit.

"Another day, another time when we've done the work we'll be able to talk about our plan here,'' Mr Newman said.

Power bills are set to surge by a staggering 21 per cent. The recommended rise has prompted fears for pensioners' health.

"But...we are determined that people are not hit with an unacceptable double digit power increase."

He pointed out the government had delivered on its "cost of living relief'' election promise by introducing a raft of measures last year.

"People have had a 12-month power price freeze.  They've received in southeast Queensland an $80 rebate on their water bills.  They've seen motor vehicle registration frozen, $7000 in tax taken off the family home,'' said Mr Newman.

"We've provided relief in the areas we said we would."

Under the QCA determination, households currently paying about $1426 a year for power, will see that rise to $1715 in the year from July.

Earlier, households could soon be paying almost $1 per day for electricity before flicking on a single switch.

COST FURY: Macadamia farmer Phil Montgomery says the draft QCA ruling will increase his water and electricity costs. Pic Megan Slade.

Phased in over three years, the cost of just having a power connection would rise from 28 cents to almost $1 per day by 2015/16.

The proposed changes would cause the average bill to increase from about $1426 to $1715 next year.

Treasurer Tim Nicholls has his say on the power price issue: We'll try to insulate consumers

However, the biggest percentage increases will be felt by both extremes of energy consumers - pensioners and holiday home owners.

Robert MacDonald says Tim Nicholls should stop the blame game

Continuing investment in the power network, coupled with subsidies to solar households and lifting of the Government's price cap accounted for more than 70 per cent of the increase under the new pricing model.

The Newman Government immediately tried to distance itself from the QCA's decision, describing it as "unacceptably large".

"This Government is determined to make sure Queensland families are not kicked in the guts by this price rise," Treasurer Tim Nicholls said.

Mr Nicholls conceded the Government would introduce whatever price rise the QCA recommended rather than override the independent authority.

However, the Government will consider making State-owned power generators and distributors absorb some of the increase.

Opposition treasury spokesman Curtis Pitt said the increase proved the LNP hoodwinked people into believing it had an answer to power prices.

Queensland Council of Social Services chief Mark Henley called on the Government to increase the level of electricity concessions available for low-income households.

The state's producers were also quick to criticise the increases, with the Queensland Farmers Federation claiming electricity costs have become one of the biggest challenges facing an industry the Newman Government named as one of its four economic pillars.

The QFF identified growers in the Pie Creek region, near Gympie, such as macadamia farmer Phil Montgomery, as being among those likely to be the worst affected.

Mr Montgomery irrigates 4000 trees on his Jones Hill property which draws water along a channel from the Mary River, and says the draft QCA ruling will double his water costs and increase his electricity costs by 50 per cent.

He says the increases will have big impacts in the food bowl of the Lockyer Valley.

Mr Montgomery paid $1500 a season for electricity to drive the pumps which draw the water. That will rise to about $4000 a season under the QCA rates.

"I'm a businessman and a business that has to cop that kind of increase is out of business," he said.

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