Bad Figures and Bad Decisions: A solar superpower sleeps


In May of last year, the State Government announced that a feed-in tariff would be introduced in Victoria. A feed-in tariff is a mechanism for encouraging the take-up of solar photovoltaic energy generation (otherwise known as solar panels). It has been very successful in Germany, transforming its solar power industry into a €2 billion export earner which employs 57,000 people.

The German feed-in tariff pays householders a premium rate for the energy that they produce from their solar panels, thereby reducing the pay-back period and encouraging take-up. This is called a gross feed-in tariff. However, unlike Germany’s model, Victoria’s feed-in tariff will only pay householders for the extra energy they feed into the grid left over after their own use, rather than the total energy produced. This is a net feed in tariff. Considering the Victorian model limits the size of eligible arrays to 2kW (which produces less electricity than the average household uses), it will be ineffective and will not result in mass take-up of solar technologies.

It was revealed last year when the decision was first announced, that the Victorian Environment Minister, Gavin Jennings was for a gross model, while the Energy Minister Peter Batchelor was in support of a net model. Mr Batchelor was able to convince Premier Brumby because he produced figures that showed a gross model would increase electricity costs to households by about $100 a year.

Last week, in a series of reports, The Age revealed that calculations by the State Government of the cost of a gross feed-in tariff was actually between $18 and $37 per year per household, and that the $100 a year figure was produced by Peter Batchelor at the last minute. It also revealed that senior state bureaucrats supported the gross feed-in tariff, claiming the State Government’s preferred model would be ineffective.

Peter Batchelor has yet to respond to questions on how he arrived at the $100 a year figure, and where it came from, considering his own department had already come up with a much lower cost figure in a detailed analysis. Did the Victorian Energy Minister simply make up the figures in order to quash a policy he didn’t like? A policy that would have seen thousands of jobs created and growth in a crucial renewable energy industry? And if he did, why did he do it when he knew the cost was not actually that great?

If these allegations are true, then Peter Batchelor has a lot to answer for. We still await his response.

To read the excellent series of investigative reports on this issue in The Age, click here, here and here.

It is not too late for the State Government to change its policy, adopt a gross feed-in tariff, and expand it to bigger solar photovoltaic systems and to commercial and community buildings as well as households. This is a policy that would do wonders for the take-up of solar energy technology, which is an essential plank of a science-based and just response to climate change.

There is currently a campaign to encourage the Federal Government to adopt a national gross feed-in tariff. Australia is a solar energy superpower, and our governments are failing to take advantage of it. To find out more and sign the petition, visit this website.