Homeowners will have to pay at least $1000 towards the cost of their solar panels, under an overhaul of the Gillard government’s green subsidy scheme.
This will end the era of installing rooftop solar systems for free or at little cost.
The solar scheme clawback comes as Industry Minister Kim Carr refuses to guarantee the future of the much criticised “cash-for-clunkers” climate change program, which is designed to reward people for upgrading to newer, less polluting cars.
The federal Climate Change Department has drafted regulations, to take effect from January, that would slash thousands of dollars’ worth of subsidies for photovoltaic units installed on homes by 20 per cent or more if “there is systematic evidence that (they) were being provided at little or no out-of-pocket expense to consumers”.
The units are generally installed as solar panels on the roof, which convert the sun’s energy into electricity to power a home or is fed into the electricity grid.
If 10 per cent of buyers spend less than $1000 for their solar power system per kilowatt of capacity, the federal Office of the Renewable Energy Regulator will reduce the number of renewable energy certificates issued for those units, according to the draft new rules.
Those certificates, which allow suppliers of solar power to earn five times as much as suppliers of coal-fired power, are currently worth about $6200 for a 1.5 kilowatt system.
The subsidies, widely used by solar energy companies to discount the price of their products and boost sales, are supplemented by a separate premium paid for green power fed into state electricity grids.
Clean Energy Council policy director Russell Marsh said yesterday that governments and electricity users were footing the entire bill for some rooftop solar systems.
“There are some instances where, in some places, in some states, people have been advertising free systems because of some of the generous rebates available,” Mr Marsh said. An Australian National University review this week revealed two-thirds of the solar panels funded under a $1.1 billion federal rebate scheme were installed in well-off suburbs.
That scheme, which offered householders an $8000 rebate to install solar panels on their roofs, was scrapped last year.
Last month, NSW pulled back its support for the fast-growing home solar power industry, by cutting by two-thirds its generous feed-in tariff for power supplied from household units.
Mr Marsh said people who had photovoltaic panels installed should expect to pick up at least some of the costs.
“I think it’s only fair to say that a government rebate shouldn’t give something away free,” he said.
Rob Sims, adviser to a climate change committee chaired by Julia Gillard, told its members on Wednesday there were far cheaper ways of achieving the government’s promise to cut greenhouse gas emissions.
“These are high-cost measures and ones where the additional cost is added to the bills of all electricity consumers,” he said.
Canberra’s plan to generate 20 per cent of electricity from green sources in 2020 ensures power companies buy renewable energy certificates, but those costs then flow through their customers.
Labor is under intense pressure to act on climate change after its decision last term to shelve plans for a carbon emissions trading scheme polarised its support base and delivered crucial votes to the Greens.
It is also fighting off damaging opposition claims that its new promise to set a carbon price will force up electricity prices. The Prime Minister faced down the critics in a speech in Adelaide on Tuesday, warning that the absence of a price on carbon would distort investment in the electricity industry and push power bills even higher.
She attacked the Coalition’s direct action climate approach of “picking winners, paying subsidies, special deals”. Opposition climate action spokesman Greg Hunt said yesterday he fully supported the concept of a shared contribution towards photovoltaic panels from householders to head off a repeat of the “disastrous consequences” of the government’s pink-batts rebate scheme.
“(Former environment minister) Peter Garrett’s first major mistake was to ensure that there was no effective contribution for solar panels once the price for solar panels dropped,” Mr Hunt said.
“Recent history dictates that there should be a contribution from householders, however modest it may be for low-income earners, to ensure both quality-control and to prevent rorting.”
The Coalition also opposes a controversial government plan, announced during the August election campaign, to cut emissions by subsidising the private purchases of new cars.
Under the government’s $400 million cash-for-clunkers scheme, car owners would be offered $2000 to ditch their pre-1995 vehicle for a new, more fuel-efficient one.
The Australian revealed this month that Senator Carr was pushing back the scheme’s start date from January to July next year.
Senator Carr yesterday would only commit the government to consulting with industry about the best way of cutting vehicle emissions.
