The Premium Feed-in Tariff is Ending, Here’s What You Can Do
As an incentive to encourage the uptake of renewable energy systems in the state, the Western Australian Government introduced the Residential Net Feed-in Tariff Scheme for eligible solar system owners in July 2010.
The scheme provides eligible applicants with a premium rate of 40 cents per unit of solar energy exported back to the grid, with a small number of system owners receiving 20 cents per unit, dependent on the date of application.
The scheme was open for applications for new and existing solar systems between 1 July 2010 and 1 August 2011, and premium rates are payable for 10 years from the date of application.
What is the difference between the Feed-in Tariff Scheme and the Renewable Energy Buyback Scheme?
In addition to the premium Feed-in Tariff, system owners also receive credits under the Renewable Energy Buyback Scheme (REBS).
This is the amount that Synergy pays to customers for purchasing their unused solar electricity. Currently, the REBS rate is at 7.135 cents per unit, however, this scheme will be replaced by the new Distributed Energy Buyback Scheme for new applications received after 7 September, which pays 10c/kWh for each unit energy exported to the electricity network between 3-9pm and 3c/kWh for each unit of energy exported at any other time.
What this means for your system now
As the premium Feed-in Tariff rates are only payable for 10 years since the application date, the scheme will end between July 2020 and August 2021. While you will continue to receive REBS payments , it means you will be receiving significantly less for your exported solar energy.
The average solar system size 10 years ago was just 2kWs; which by today’s standards would barely be able to cover modern household energy requirements. Therefore, with the elimination of the FiT and a significantly smaller system, the savings generated by these systems is likely to be minimal. This means you could be up for some very large energy bills when your FiT ceases.
Can I just add more panels?
While technology has improved significantly over the past decade, it means many of the components used in these older systems are now obsolete. And because regulations have changed, new and old equipment cannot be combined. This means you cannot simply add on more panels to increase your system size. We recommend considering installing a new, larger-sized system altogether. This way you can ensure your new system is able to meet your energy needs both now and into the future.
What about warranties?
Many of the warranties for these older systems will have already expired or be close to expiring soon. For example, most panel warranties were just 10 years, with inverters only having a 5-year warranty. Therefore, it is likely that your entire system will be out of warranty now, so any faults or repairs will need to be covered at your expense.
What should I do now?
To avoid receiving larger energy bills, we encourage you to consider purchasing a new system that is able to support your current and future energy needs. Your energy consultant will be able to design a solar system that is suitable to your budget and able to support your household’s energy requirements. A new system will also ensure that you have updated warranties and access to the latest technology.
Benefits of purchasing a new system
- Reduced electricity bills: Installing a new system that is sized appropriately will ensure that your current and future energy needs can be supported by solar.
- Claim the government’s STC rebate: when replacing your system, you will able to claim the full STC rebate allocation provided by the government. STC’s work by providing you with a discount off the total cost of your solar PV system.
- Latest technology: A new system will ensure that the components you’ve selected are in-line with the latest technologies, meaning better efficiency and more savings for you. Opting for systems that are battery-ready will also prepare you for when you'd like to add a battery in the future.
- Support from updated warranties: Thanks to advances in technology and increased competition in the market, solar panel warranties have improved dramatically over the past decade. Industry leaders like SunPower offer a 25-year product warranty across their entire solar panel range. All of our inverters are backed by a 10-year warranty.
The importance of purchasing quality components
Many of our customers who installed their system with us 10 years ago had their system installed with quality brands, resulting in very few service issues and a long-lasting system. For example, SMA inverters were considered a top-quality inverter 10 years ago, and still are to this day.
Unfortunately, we have heard numerous stories of other companies selling cheap, low-quality components to residents, only for them to experience multiple failures, or have the manufacturer leave the Australian market. This leaves customers without any local support, and with a warranty that is practically worthless. Since 2011, more than 750 solar companies have gone out of business. It is estimated that 1 in 3 solar systems are ‘orphaned’, meaning the company the system was originally purchased from is no longer around.
Infinite Energy have been providing quality solar systems for over 10 years and have since become one of the largest and most trusted solar providers in Australia. Our customers can have confidence that they will be supported through their entire solar journey, from initial consultation right through to post-sale support.
If you would like to discuss your options for a new solar system with one of our expert energy consultants, please contact us today and we would be delighted to assist. By ensuring you have an adequately sized solar system that is protected by reliable warranties and up-to-date technology, you can protect yourself from high energy bills and future price increases for the decades to come.
This blog refers to the Renewable Energy Buyback Scheme (applicable to Western Australians), which is changing over to the new Distributed Energy Buyback Scheme for applications received after 7 September. Click here to learn more about what these changes entail.