The recent report that Tony Abbott has instructed the Clean Energy Finance Corporation (CEFC) to cut investments into wind and small-scale solar projects has been wrongly interpreted by a lot of people who now fear that the existing solar incentives have been scrapped. This is not the case. The CEFC is purely a funding body set up by the Government to provide finance to various entities wishing invest in clean energy technology.
The confusions stems from the fact that a directive has been issued by the Abbott Government that the Clean Energy Finance Corporation must no longer release funding for investments in household and small-scale solar. The only connection between the CEFC and household or residential solar are those projects that help people who do not own their own homes, those who live in apartments and community groups get solar.
The other link to small-scale solar through the CEFC was a recent agreement between the corporation and Origin Energy. This was a 12 year, $100 million CEFC financing commitment that would allow Origin to offer Power Purchase Agreements (PPA’s) to its residential and commercial customers. Origin would install solar equipment (financed by the CEFC) on the roofs of its clients properties and their clients would then commit to buying the ‘cheap’ energy generated from the solar panels installed on their roof. This would yield a return to the CEFC of around $1 for each $1 invested. Origin was also looking at utilising the CEFC to assist with its plan to roll out battery storage for its solar customers.
This has no impact what-so-ever on the existing solar incentive scheme that remains firmly in place after the Government recently reached an agreement with the Labor party to keep the Renewable Energy Target in place with a reduced Target of 33,000 gigawatt hours of annual renewable energy production by 2020. This means that the existing solar rebate/incentive scheme remains firmly in place.
The Renewable Energy Target is a mechanism to encourage the uptake of solar technology through the creation of certificates that are applicable to residential or commercial solar installations under 100kW’s in size. These small-scale technology certificates (STC’s) have a monetary value to the home or business owner and can be used to offset as much as 1/3rd of total cost for installing solar electricity systems.
Article by Mark McClurg – Managing Director of Coffs Solar Energy