Electricity industry must open its eyes to benefits of homes installing solar panels

By Rob Stokes

Read more: http://www.smh.com.au/comment/electricity-industry-must-open-its-eyes-to-benefits-of-homes-installing-solar-panels-20131027-2w9kh.html#ixzz2iyOeGi64

 

'Solar panels have moved from being a fringe technology to a disruptive technology, challenging the way energy businesses operate.'‘Solar panels have moved from being a fringe technology to a disruptive  technology, challenging the way energy businesses operate.’ Photo: Emma  Kelly

Solar panels are revolutionising the Australian electricity market.  The pace  of change is faster than official projections, and the effects  on customers and  energy companies are profound and irreversible.

Australian homes and businesses have installed almost three gigawatts of  rooftop solar photovoltaics  –   one of the highest rates  in the world.

Solar  panels have moved from being a fringe technology to a disruptive  technology,  challenging the way energy businesses operate.  As with every  revolution, the solar  revolution is facing a reactionary response by the  established order.

Last week the body charged with the development and maintenance of the   national electricity market, the Australian Energy Market Commission,  set out  its   priorities for  developing  the electricity market.

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One sentence in the report grabbed my attention in particular: “Stakeholders  are concerned that network costs of consumers with solar  are cross-subsidised  by other consumers, due to current inefficiencies in network tariffs.”

In other words, energy companies want households with solar panels to pay  more to access the electricity grid than customers without solar.  The idea is  that because  electricity pricing reflects the total volume of energy taken from  the grid, households generating some  energy are not paying their fair share of  the cost of being connected to the network, and should therefore compensate  those who buy more electricity.

This is a really bad idea. First, it is  unfair.  In  the past few years,  more than 1 million  households have installed solar panels on the understanding  that they would pay the same amount for  electricity they buy as everyone  else.

Second, it is discriminatory.   Solar panel users are not the only  electricity customers having  an impact on the electricity grid.  The  installation of cheap, imported airconditioning units in hundreds of thousands  of households in recent years is a big contributor to the rise  in capital  spending by networks to enable them to meet peak demand.

However, I cannot imagine  anyone seriously arguing that households with  airconditioners should pay more network costs than other customers.

So, why is solar energy  being targeted?  Perhaps because solar-powered   households buy less electricity than non-solar households with  airconditioning?

While solar  might disrupt the way in which the electricity grid operates,  rooftop solar in the right locations can actually help to defray network  upgrades by supplying energy in constrained areas of the grid to meet demand  spikes.  The hot, sunny weather that induces people to buy airconditioning also  generates lots of  photovoltaic electricity.

A strategic approach to solar panels  can lessen  the need to bolster  the   grid, the main contributor to higher  electricity prices.

Finally, the idea of slugging solar households for extra network costs is bad  politics. Already 1 million households have solar  panels and the  government  plans to support installation  for another  million.

Rather than seeking to target and penalise households that are taking  advantage of renewable energy technology to lower  their bills and environmental  impact, it is time for energy businesses to change their thinking to embrace  innovation,  rather than thinking up ways to stop it.

Dr Rob Stokes is the NSW parliamentary secretary for renewable  energy and energy innovation. He does not own solar panels, or an  airconditioning unit.

Read more: http://www.smh.com.au/comment/electricity-industry-must-open-its-eyes-to-benefits-of-homes-installing-solar-panels-20131027-2w9kh.html#ixzz2iyOLJQj9

 

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