There are probably more solar panels in QLD than anywhere else in the world. Back in February last year, the boss of the Queensland state power company announced the awkward result that households with solar panels were using more electricity than those without. Apparently people without solar were turning off the air conditioner because electricity cost too much, but the solar users didn’t have to worry about the cost so much.
Queensland solar homes are using more grid electricity than non-solar, says Energex boss
Feb 2016: Solar-powered homes in south-east Queensland, which boasts the world’s highest concentration of rooftop panels, have begun consuming on average more electricity from the grid than those without solar, the network operator has found.
Terry Effeney, the chief executive of state-owned power distributor Energex, said the trend – which belied the “green agenda” presumed to drive those customers – was among the challenges facing a region that nevertheless stood the best chance globally of making solar the cornerstone of its electricity network.
From October 2014 in Queensland, the average grid electricity use of solar homes started to exceed the average use of people without solar power and stayed higher for the at least the next 18 months (when this story appeared).
In other words, subsidized solar panels could mean that the people who pay the subsidies use less electricity than the people who get the subsidy and the panels. It also means the poor, who can’t pay for panels, have to go without more often.
Playing God with markets doesn’t have to be this hard. If the price of electricity is the largest influence on behaviour, the government could have just slapped on a bigger electricity tax, and that would have cut electricity use across the board. Thousands of people wouldn’t have wasted millions of dollars installing solar panels. The money would have helped the state government provide a service that was more useful than weather-unchanging-electronic-panels. Queensland could have had more healthcare, more holidays or less debt, instead they changed the color of their electrons.
What’s the point of solar, CEO Terry Effeney wondered out loud at a Brisbane business luncheon even on the future of electricity, if it wasn’t reducing demand and reducing the amount of coal-fired generation.
Parkinson tries to explain why this might not be:
One of the problems is that there are no direct comparisons … of, say, big families with a lot of energy use, using solar or not, and people who live in apartments, or pensioners, and using solar or not. And it doesn’t compare houses before they had solar and afterwards.
It could also be that the biggest electricity users also took up solar. When you take out the biggest users, that reduces the average for the remainder. The fact that it is flattened now suggests that may be the remaining households have run out of ways to cut demand.
The biggest users of electricity are the homes with more airconditioning, heated pools, extra fridges. Wealthier people can afford the capital outlay to buy solar panels. But it doesn’t explain why their grid use declined in 2010 and increased in 2014.
The artificial tariffs encourage people to feed their solar to the grid when it doesn’t need it, and draw back electricity later:
There is a further complication. Even those houses with more solar than they need have no incentive to move demand (such as pool pumps, air conditioning and other appliances) to the daytime when it could be supplied by their rooftop solar, because of the structure of the tariffs, particularly the 300,000 on the premium feed in tariff.
They get 44c/kWh for solar exported to the grid, and a lot less for imports. It is totally different to whether the solar households are helping reduce coal consumption. On Energex own evidence, they do, because they now account for 7.4 per cent of total demand.
The premium feed in tariff is a perverse incentive and one that would require some clever thinking to get around. A recent suggestion by the Quensland Productivity Commission to simply end them was dismissed straight away.
It has more than 1,000MW of rooftop capacity and at its peak that could theoretically satisfy 20 per cent of demand at any one time (although South Australia and Western Australia are predicted to go to 100 per cent of demand at certain times within the next decade).
Of course the voters would have hated a straight electricity tax. Perhaps the appeal of a complicated subsidy scheme is that it looks so “progressive” yet hides the government mandated tax, and provides an escape clause for wealthier citizens. It also created a whole class of voters with a pro-renewables interest in maintaining the subsidies.
Let’s have a free market in energy I say. I can buy boutique solar powered flow for 44c.. The wholesale rate of coal power is around 3 – 4 cents a KWh. Gimme, gimme, gimme cheap coal-fired electrons. Where do I get that choice?