Dip in solar feed-in tariffs

Dip: A decrease in solar feed-in tariffs is driven mainly by a decline in wholesale energy costs. Photo: Shutterstock
Dip: A decrease in solar feed-in tariffs is driven mainly by a decline in wholesale energy costs. Photo: Shutterstock

In the lead up to a new financial year, the Queensland Competition Authority (QCA) determined a mandatory solar feed-in tariff for customers in regional Queensland for 2021-22 and this is now in place.

The QCA set the feed-in tariff at a lesser 6.583 cents per kilowatt hour (c/kWh) which came into effect from July 1.

QCA chair Professor Flavio Menezes said that this value will give customers with solar panels a fair and reasonable return for the electricity they export to the grid.

Lower wholesale energy costs are primarily due to the expected continued entry of a large amount of renewable generation into the National Electricity Market

Professor Flavio Menezes

"This rate is lower than last year's feed-in tariff of 7.861 c/kWh. This decrease is driven mainly by a decline in wholesale energy costs," he said.

"Lower wholesale energy costs are primarily due to the expected continued entry of a large amount of renewable generation into the National Electricity Market."

Professor Menezes said when retailers source energy from customers with solar panels, they avoid having to pay some of their normal business costs.

"Costs that the retailers do not pay are wholesale energy costs, certain fees levied by AEMO and the cost of energy losses associated with transporting electricity over long distances.

"The QCA estimates these avoided costs and uses the estimates to calculate the solar feed-in tariff.

"However, retailers still incur most of their normal business costs, including retail operating costs and network charges.

"That is why the solar feed-in tariff is less than regulated electricity prices," he said.

Customers who receive the 44 c/kWh feed-in tariff under the Solar Bonus Scheme will not be affected by the new tariff.

They will stay on the same feed-in tariff until 2028 as long as they maintain their eligibility.

Customers in south east Queensland (who are on the Energex distribution network) can choose from the feed-in tariffs offered by retailers.

These tariff rates are published on the Australian Energy Regulator's price comparator website www.energymadeeasy.gov.au.

The solar feed-in tariff report is available on the QCA website.

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