Energy companies charging NSW solar panel owners for exporting power criticised by lobby group

In NSW about 12% of homes with solar panels have a battery, meaning most export energy during peak times. Photograph: ImagePatch/Getty Images

A new tarriff that will see solar panel owners charged for exporting their energy during the middle of the day could discourage solar uptake, consumer groups say.

Ausgrid, which has around 280,000 customers in New South Wales with rooftop solar panels, has introduced a two-way tariff system to incentivise solar panel owners to export their power into the grid in the evening, when it is most needed.

This will include a charge to solar panel owners of 1.2 cents a kilowatt-hour to send electricity to the grid between 10am to 3pm once exports hit above a free threshold.

The owners could also see a return of 2.3 cents a kilowatt-hour if they export power during the peak demand time of 4pm to 9pm.

Other energy distributors in NSW and the ACT proposed similar plans last year, including Essential Energy, Endeavour Energy, and EVOenergy, according to consumer group Solar Citizens.

Solar Citizens’ chief executive, Heidi Lee Douglas, said the group does not support the tariff. It believes the move is a roadblock to solar uptake, given few solar panel owners will benefit from the return.

She said this is due to a low uptake in batteries among solar panel owners, which would allow consumers to benefit from the change by storing their power during the day and selling back to the grid during the evening when the return is high.

The price is main inhibitor to uptake, Douglas said, with batteries costing upwards of $10,000. About 12% of homes with solar panels have a battery, according to figures by SunWiz, and 13.5% in NSW.

Douglas said the change may see consumers installing smaller solar power systems so they aren’t penalised for exporting energy during the day.

“We actually need the government to be removing the roadblocks for those people to get the cost of living benefits of solar energy,” she said.

Douglas said governments should be doing more, and urged the NSW state government to follow Queensland’s lead of increasing battery uptake via providing financial support for the cost.

Greg Giles, who has had solar panels on his Newcastle home for 15 years, said he had explored buying a battery to store his power, but can’t afford the price on his fixed income. The retiree is not an Ausgrid customer, but if his distributer follows suit, he’s unlikely to benefit.

He said he tends to try do his more energy-demanding chores – like putting on the washing machine or dishwasher – during the day. But he still generally has an excess of power that’s exported to the grid during the day.

“I’m not going to be generating much power after 6 or 7pm in summer, and not much after 5pm in winter, so the only way to benefit will be to have a battery already installed and then export it then,” he said.

The director of the Grattan Institute’s energy program, Alison Reeve, said the federal government had been investing in community batteries for the purpose of having an option for consumers who can’t afford to buy their own.

She disagreed the introduction of two way tariffs would have a major impact, arguing it would would lower power costs for a vast number of consumers, regardless of whether they have solar panels.

Reeve said the change had been triggered by problems caused by the flood of power exported by solar systems during the day rather than at night when its needed.

She said the current system unfairly penalises anyone who hasn’t been able to afford solar.

“The existing system is actually unfair on a much larger group of people, then this change will be on that smaller group.”

A spokesperson for Ausgrid said a typical solar customer should see an increase of 13 cents a week, equalling $6.60 a year.

“The impact on customers will depend on how retailers pass through the charges and rewards, and how and when households use the power from their solar systems,” they said.

Reeve said she understands some retailers have said they won’t be passing the cost along on a consumer by consumer basis, and instead will spread costs across their customer base – which is unlikely to make a notable difference.

A report released last week by research group Nexa Advisory examining how to increase battery and solar panel uptake found distribution networks devote less than 1% of their expenditure on managing exports of power, suggesting there’s no difficulty with exporting rooftop solar.

The chief executive of Nexa Advisory Stephanie Bashir, also a board member of the Smart Energy Council, said the export tariffs were not needed and that any tariff shouldn’t discriminate against those who’ve invested tens of thousands into solar “trying to do the right thing”.

“It’s on the government to ensure its managed in a way that isn’t penalising people,” Bashir said.

“Consumer energy can be a great tool for energy transition, its a huge contributor, and there are better ways of taking this contribution and turning it into a positive for the energy system.”