Solar Shutdown's Legality Likely to Face Challenge
by Ben Cubby, Sydney Morning Herald
May 6, 2011
THE state government may have acted unlawfully when it suspended the state’s solar panel tariff system – and angry panel installers and customers are mustering for a class action.
The government failed to publish the change in the Government Gazette beforehand or state that the scheme had reached maximum capacity of 300 megawatts – technicalities which may mean the scheme should not have been suspended last Friday.
Those in the industry who think the government has breached the law said power utilities should not be stopping new solar households from connecting to the grid.
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The Minister for Resources and Energy, Chris Hartcher, said he had the authority to announce changes to the scheme and legislate retrospectively. But no legislation for changing the scheme has been put to Parliament.
‘‘All customers who submitted applications before midnight 28 April, 2011, but are not yet connected to the solar bonus scheme, may still be eligible to participate in the scheme subject to the requirements of the current legislation,’‘ a spokeswoman for Mr Hartcher said. ‘‘All aspects of the scheme will be reviewed by the solar summit which may make recommendation to the government.’‘
The solar summit is a gathering of industry figures and government representatives, part of which will take place in Sydney today, to grapple with problems caused by the solar bonus scheme. The previous government introduced the scheme and it was far more popular than anticipated, grossly exceeding its budget.
An environmental law lecturer at the Australian National University, James Prest, said the announcement has exposed the power utilities to potential court action for not certifying people’s connections to the power grid.
‘‘Until the change is subject to legislation or has been gazetted, the distribution network service providers are potentially in breach of their licence conditions and they would be liable for damages,’‘ Dr Prest said.
The Electricity Supply Act 1995 states that the network service providers must connect households, but since Mr Hartcher announced the scheme was suspended some are no longer doing so.
‘‘In his rush to kill off the solar bonus scheme, Energy Minister Chris Hartcher bypassed his legal requirements and exposed the state to the risk of an expensive class action,’‘ said the Greens MP John Kaye.
‘‘The O’Farrell government has put its hostility to renewable energy on display. They were prepared to act outside the law to kill off the solar bonus scheme and to stop people connecting panels to the grid.’‘
One solar panel installer, SolarSwitch, said utilities including Country Energy and Energy Australia were not certifying solar systems owned by its customers because of the announcement.
‘‘Every single day the energy companies hold off it is costing us and our customers money,’‘ said Alle Tesoriero, a SolarSwitch spokeswoman. ‘‘We will be seeking legal advice and supporting our customers if the situation in NSW is not resolved.’‘
The Solar Energy Industries Association, a group representing a large portion of the state’s solar panel installers, said the solar industry was in limbo.
‘‘We have companies with literally warehouses full of panels that they have already bought, and no idea if they can even make their money back,’‘ said the association’s chairman, Ged McCarthy.
Installers and customers would explore the possibility of mounting a class action against the power providers, he said.
The industry was also digesting news yesterday the federal government would reduce subsidies for panel installation from a peak of up to $6200 to June 30 this year to about $1200 for a basic 1.5kw system after July 1, 2013.