Feeds

Australia cuts solar subsidies, and not before time

It's becoming competitive, and doesn't need support

Seven Steps to Software Security

Before anybody denounces me as being “anti-solar” I want to put this on the record: I own 16 solar panels, a largish inverter, and because the system was built in the days before grid-connect arrived in Australia, a decent-sized bank of batteries.

Australia is now host to a lively – in fact, heated – debate over the way governments are winding back various solar power subsidies. Last year, the NSW government reduced the “feed-in” tariff that consumers would be paid for power coming from their solar panels; this month, the federal government cut the subsidy it will pay for installing solar power.

That subsidy, which peaked at more than A$6,000, will now be around A$1,200 for a 1.5 kW system.

That is, of course, a trigger for doom-and-gloom statements from interested parties, environmental lobbies, and the solar power industry – but I wonder whether things are as bad as they seem.

One thing that people forget is just how far the price of some solar components has fallen in recent times.

I have on hand a 2008 price list from a solar components supplier. In that price list, a 130-watt panel from Kyocera costs A$1,100. Today, from the same retailer, the best price is under A$800 – a fall of nearly 30 percent in just three years.

That is a pretty dramatic reduction in price – not so much as you might expect if you were accustomed to the computer industry, but significant. And that price deflation has happened in the presence a significant subsidy, which would tend to put a floor under prices.

The removal of the subsidy should tend to drive down prices. Retailers need to keep the stock turning over, and if the prophets of doom are correct, they will have to do so in the face of bankrupt stock hitting the market sometime soon.

Of course, panels aren’t all there is to a solar installation. The other big-ticket items are inverters (grid-connect or standalone, depending on system type) and batteries (for off-grid systems).

Grid-connect inverters have seen some small price deflation – about 10 percent; standalone inverters haven’t fallen at all; and battery prices have risen. Note that standalone inverters and batteries are characteristics of off-grid solar, which doesn’t attract the same government support as grid-connected systems.

All this combines to suggest to me that the market dynamics here are more complex than “subsidy equals success, no subsidy equals disaster”.

The Power of One eBook: Top reasons to choose HP BladeSystem

More from The Register

next story
Bad back? Show some spine and stop popping paracetamol
Study finds common pain-killer doesn't reduce pain or shorten recovery
Malaysian Airlines flight MH17 claimed lives of HIV/AIDS cure scientists
Researchers, advocates, health workers among those on shot-down plane
World Solar Challenge contender claims new speed record
One charge sees Sunswift travel 500kms at over 100 km/h
Mwa-ha-ha-ha! Eccentric billionaire Musk gets his PRIVATE SPACEPORT
In the Lone Star State, perhaps appropriately enough
SMELL YOU LATER, LOSERS – Dumbo tells rats, dogs... humans
Junk in the trunk? That's what people have
All those new '5G standards'? Here's the science they rely on
Radio professor tells us how wireless will get faster in the real world
The Sun took a day off last week and made NO sunspots
Someone needs to get that lazy star cooking again before things get cold around here
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.