When the calendar flipped over to January 1, feed in tariff rates for many EnergyAustralia customers were reduced.
The following indicates the rates prior to and after the cut.
- New South Wales: 10.5 c/kWh -> 9.5 c/kWh
- ACT: 10.5 c/kWh -> 9.5 c/kWh
- South Australia: 11.5 c/kWh -> 10.5 c/kWh
- Queensland : 11.5 c/kWh -> 8.5 c/kWh
As for Victoria, the rate remains 12.0 cents per kWh for now, but is currently under review. A new rate will be announced to apply from February if there is to be any change1.
When Shopping Around Electricity Retailers, Remember..
It pays to shop around for the best solar plan, which isn’t necessarily the one offering the highest feed-in tariff. The best electricity plan for solar owners offers a good balance of high feed-in-tariff rate, low usage tariffs and low daily charges.
SolarQuotes has a tool enabling you to compare electricity plans for solar owners. Unfortunately, it hasn’t been updated since October as the data feed that was previously used is no longer available. The SQ team is working on a new one, but in the interim the tool is still useful as it demonstrates how a high feed in tariff doesn’t always mean the overall cheapest electricity plan.
Focus On Self-Consumption
Feed in tariffs in Australia aren’t as high as they used to be. In the early days of Australia’s rooftop solar revolution, very generous rates were offered to promote uptake of the technology. High feed in tariffs, a generous solar rebate (which is still available) and ongoing reduction in the cost of solar certainly worked. Nowadays, so much solar electricity being generated in the middle of the day that the wholesale market value of electricity generated between 10 am and 3 pm has been falling, and this plays a role in feed-in tariff rates being reduced.
Less generous feed-in tariffs certainly don’t mean going solar isn’t worth it any more. It just means payback can be accelerated with a greater focus on self-consuming the electricity generated.
Using New South Wales as an example where the EnergyAustralia feed-in rate is now 9.5c kWh, mains supplied usage rates are currently between 24.8c and 29.6c depending on the EnergyAustralia plan. This means self-consumed solar electricity is more than two-and-a-half times as valuable as electricity that is exported, based on the cheapest usage rate.
Increasing solar energy self-consumption can be as simple as being more conscious of when electricity-hungry appliances are being used and “load-shifting” to the daytime where possible, either manually or through the use of timers. If you have gas appliances on their last legs, you can consider switching them to electric. There are also some interesting gadgets available including Catch Power’s Solar Relay and solar diverters that can help maximise self-consumption.
If you’re still tinkering with the idea of installing solar and would like to determine if the bill-busting technology is right for your circumstances (and if you have suitable roof space, it most likely is), try SQ’s solar calculator. The calculator is very easy to use and will provide you a complete picture of the estimated savings and payback for solar power systems, wherever you are in Australia.
Related: Why Solar Feed-in Tariffs Won’t Vanish Any Time Soon – Or Ever.
Footnotes
- In Victoria, the minimum feed-in tariff rate is set by the Essential Services Commission. In November 2020, it proposed a minimum single rate feed-in tariff for the 2021–22 financial year of 7.1 cents per kilowatt-hour. This isn’t set in stone. The ESC’s final decision is expected in February and this is a minimum rate. Electricity retailers can offer more, and they often do. For example, the current minimum feed in tariff rate in Victoria is 10.2c, but EnergyAustralia is offering 12.0c. ↩
About Michael Bloch
RSS - Posts
Aside from it’s wholesale value, what else goes into determining what is a fair market FIT?
e.g. in FY2019/20 based on wholesale prices for each half hour my PV exports resulted in a weighted average of 8.3c/kWh while my retail FIT was 10.5c/kWh.
The FiT is dropping pretty rapidly. I joined Energy Australia only about 16 months ago and it has gone from 16.1c to 8.5c in that time. Near as dammit 50%. I do self consume plenty but this is still going to hurt my bottom line to the tune of about $200/yr. I reently bought an EV so at least I can offset some of that by charging the vehicle when the sun is shining.
This drop in FIT added a whole year to my ROI calculations. We only self-consume a lot on the weekends, and were banking on high FIT to help offset the cost.
I’ll be looking around, but the problem in QLD is that Energex are also mandating Demand tariff for all smart meters from July 2021, which will again increase peak costs fairly significantly at most providers. It looks like they will be charging around 25c per 1kW peak usage in a 30 minute window between 4pm and 8pm. So for the average house, that’s an extra 50-75c per day just in demand charges.
Going to make the calculations for “best energy provider” incredibly difficult!
I don.t have roof top solar but you would expect this to happen and the rates will drop more sooner rather then later.thr great green scheme is slowly biting people as i said it would.the power companies are not going to pay a premium for power they can.t sell.
Energy Australia has announced a further drop in the feed in tariff from 9.5 cents to 7,5 cents effective 1st October 2021.
A 2 cent reduction or a decline of 21%.
The really ugly aspect for me was I had just come off a 10 day cooling off period on my new contract when notified of the change.
My solar system is working great but difficult to see with the new feed in tariffs the payback period on the installation will eventuate.
I think the future financial returns for all of us will rely heavily on cheap and reliable batteries.
In a little over owning solar for a year, Energy Australia’s FIT has gone from 13.5c -> 11.5c -> 9.5c -> 7.5c. They’ve effectively halved what they deem our power to be worth, yet still charge us 24c for theirs. The worst thing about it all is that they’re overall still one of the cheapest to use due to low daily access charge and lowish usage rates.
Batteries are definitely looking more and more like the way forward.
Thanks Sebastian
The real dilemma for me is what do you tell family and friends about going solar at these rates.
The environmental impacts are enormously positive but really no energy company wants your excess power at the time when it’s available to the grid.
I really think I would say wait till we have cheap and reliable batteries and your driving a battery operated car. That’s when home generated solar will no longer be an option but a must.
Regards Ralph