New South Wales’ Solar Bonus Scheme is all but dead after industry experts and the state government agreed it was too costly to continue in its current form.
Today’s Solar Summit in Sydney resulted in a unanimous consensus to close off the scheme to stem further blowouts to the state budget.
“This particular scheme, which there’s been a consensus here today, needs to be closed and needs to be closed off in a fair manner,” said NSW Energy Minister Chris Hartcher.
In April, Premier Barry O’Farrell revealed the scheme had already cost the state a budget overrun of $759 million.
A day later, Mr Hartcher suspended the scheme for two months and announced the total cost could reach $1.9 billion.
The summit heard from senior government officials and renewable energy experts, who recommended ways to stage down the program and reduce future costs.
Rod Sims, chairman of the Independent Pricing and Regulatory Tribunal (IPART), said the 17 per cent rise in electricity prices from July 1 would rise by another five to 10 percentage points if the NSW government opted not to absorb the scheme’s blowout in the budget.
“If you’re interested in action on greenhouse, I think the solar panels process has probably put the cause back, not helped,” Mr Sims told the summit.
Ged McCarthy, chairman of the Solar Energy Industries Association (SEIA), met Mr Hartcher this morning to discuss processing the tens of thousands of applications received before the scheme was suspended.
“It looks like they’re going to be in the existing scheme as it is,” Mr McCarthy told reporters afterwards.
But Mr Hartcher’s office later said no such agreement was made.
Mark Duffy, deputy director-general of the NSW Department of Trade and Investment, Regional Infrastructure and Services, told AAP the outstanding applications could push the total output of the scheme to over 350 megawatts – over and above the scheme’s cap of 300mw.
“There’s no doubt that this is an enormously expensive way to abate carbon,” he said.
Clean Energy Council (CEC) executive chairman Matthew Warren warned the scheme’s closure should consider that solar panel companies have about $200 million in unused stock, and customers awaiting installation have paid $20 million in non-refundable deposits.
He recommended the outstanding applications be processed under the existing scheme while those received during the two-month suspension should benefit from generating their own power but not receive a feed-in tariff.
Under the scheme, residents receive a net profit from generating their own electricity.
Mr Hartcher said the outcome of the summit would be discussed with the premier but he would not give a date for when details about the future of the scheme would be announced.
Stage two of the summit is scheduled for June 7 in Newcastle with a focus on developing future renewable energy programs.