While the nation-wide installation of rooftop solar has been going from strength to strength, putting Australia up front as the world leader in per capita uptake, renters have been somewhat left behind. A new initiative from the Queensland government, which is part of its $2 billion Affordable Energy Plan, promises to unlock the potential of solar power savings for tenants.
The trial program will include up to 1000 households in Bundaberg, Townsville and Gladstone, which will be offered rebates of up to $3500 to encourage rental property owners and their tenants to go solar.
Under the scheme, tenants and owners must agree to having rooftop solar installed. To be eligible to apply for the Solar for Rentals trial:
- The property must be a house, townhouse or duplex located in Bundaberg, Gladstone or Townsville.
- The house must have its own roof space and it must be rented for less than $350 a week.
- Landlords and tenants must also both agree to a fair increase in rent and sign a new 12 month lease agreement.
The amount of the rebate reflects the size of the system installed, with only one rebate available per rental property:
- $2,500 for systems 3 kW to less than 4 kW
- $3,000 for systems 4 kW to less than 5 kW
- $3,500 for systems 5 kW or greater.
While the owner will receive the rebate to install the system, the feed-in tariff will go to the tenant as the electricity account holder. In return for use of the solar system, the tenant will pay a rent increase, which “must be fair and reasonable and agreed by both parties”.
This will potentially save up to $300 per year by either using the solar power or selling it back to the electricity grid (assuming $1,000 in electricity savings and a rent increase of up to $700), the government calculates.
The untapped market segment
Boasting the nation’s largest rooftop solar fleet, Queensland has over 2.3 GW of PV capacity installed on more than 30% of homes. Thus far, solar has been mostly confined to those who own their homes.
“This trial is all about giving tenants the opportunity to save on their power bills and their carbon emissions similar to the other 500,000 Queenslanders who are enjoying the benefits of solar,” Energy Minister Dr Anthony Lynham said, noting that the government has worked with industry and stakeholders including Tenants Queensland and the Real Estate Institute of Queensland to establish this trial.
“Most importantly, the government rebate will only be available if the tenant and property owner have agreed to a fair rent increase, offset with power bill savings. A typical household could save between $400 and $500 even after a $10 per week rent increase.”
Although many of Australia’s numerous tenants have expressed interest in reducing their power bills with solar, the market segment has remained largely untapped. Arguably the biggest solar rental announcement thus far came from the Victorian Labor government in the run-up to the last year’s state elections, which pledged to provide $82 million in rebates over 10 years, targeting an initial 50,000 homes. As an alternative to installing solar on a rented property, the idea of community PV arrays or ‘solar gardens’ has been gaining traction, with ARENA pouring in funds to fertilize the concept.
In Queensland, the Palaszczuk government had previously kicked off another solar trial involving public housing households in Lockhart River, Cairns and Rockhampton, while another initiative was launched last year by roofing materials supplier Stoddart Group alongside energy retailer Powershop and software firm Reposit Power to install 15,000 PV systems on rental homes.
“Solar in rental properties is commonly overlooked by Queensland’s landlords, so it’s fantastic to see the Queensland Government helping tenants access the benefits of solar,” said Tenants Queensland chief executive officer Penny Carr.
The trial will run until June 30, 2020, or when the $4 million funding has been allocated.