Solar export charging: a solution or just added confusion?

My partner and I just bought our first home, and after years of renting, we’re excited to get the keys and finally have the chance to install solar. But the process of choosing a solar installer and appropriate system size, ensuring that our appliances are set up to utilise energy during the middle of the day, and picking the best deal from a retailer is daunting – even for someone like me who works in energy.

The influx of rooftop solar is not without issues.

Image: ARENA

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In a few years a new complexity could be added to the mix: the Australian Energy Market Commission (AEMC) is deciding right now if they should change the rules of the National Electricity Market and allow solar customers to be charged for exporting energy to the grid. This would become just another confusing factor that Aussie homes and businesses would have to consider when weighing up if they should invest in solar. 

The AEMC’s proposal is being put forward to alleviate grid constraints associated with a surplus of solar energy in the middle of the day – but the proposal is far from popular. The debate about solar export charging, also known as the ‘sun tax’, has divided energy stakeholders and even state governments. 

In recent submissions to the AEMC, both Victoria and Queensland argued that they don’t think export charging is justified at this time. Queensland’s submission goes further by saying: “Customers who invest in DER are contributing to a global effort to reduce the impacts of climate change and should continue to be appropriately rewarded for providing this service.”

A number of states, including Victoria, Queensland and Tasmania, are requesting that they get to choose if the new rules apply in their jurisdiction or not. If this goes ahead we’re going to see solar owners in some states protected while others are slapped with fees for exporting clean energy to their neighbours.

The debate about solar export charging is a hot button issue and many stakeholders in the energy sector are calling for more details about the AEMC’s proposal. How much will these charges be? Under what circumstances will they be applied to solar consumers? Will retailers pass on individualised export charges, and if so, what additional administrative costs will that incur?

The complexities of this proposal raise more questions than they answer, and without broad support from consumers, the energy sector and state governments, the AEMC should go back to the drawing board. 

There are alternative approaches that state governments and network service providers can implement that will allow for the continued uptake of rooftop solar, which include:

    1. Incentivising the uptake of electric vehicles. If you have rooftop solar and an electric vehicle, it’s a no-brainer to charge up your car when the sun is shining to make the most of the cheapest form of energy. The rollout of electric transport could help soak up excess solar energy during the daytime, and just like governments have done successfully with rooftop solar, they can drive down the cost of electric vehicles by providing incentives and growing the local market.
    2. Rolling out community-scale batteries. Shared community batteries can store cheap solar energy and allow households with and without solar to access that energy around the clock. States like Western Australia and Queensland are supporting the rollout of community-scale batteries, but much more investment can occur in this space.
    3. Implementing Dynamic Operating Envelopes (DOE). Rolling out DOEs means that instead of having fixed export limits, solar inverters are able to respond to flexible limits based on how much grid capacity is available. At the moment export limits are often conservative and set to reflect worst-case grid conditions – so implementing flexible limits could allow consumers to export more of their solar energy.
    4. Investing in industries that can utilise abundant solar energy like renewable hydrogen. Abundant cheap solar energy during the day isn’t a burden if it’s utilised: it can stimulate new industries and help future-proof regional economies. I’m based in Queensland where there are several renewable hydrogen projects proposed, including a proposal in Townsville for a 300MW renewable hydrogen facility. Manufacturers and mineral processing facilities are also looking to set up shop in Australia to make the most of this cheap, clean energy. 

In response to the Australian Energy Market Commission’s proposal to allow solar export charging, key stakeholders have raised concerns about whether this proposal is firstly justified, and secondly the best approach to managing the continued growth of rooftop solar. 

To take stock of the extensive feedback the AEMC has received on the proposal, they’ve delayed the release of their final determination until August 12 – so we’ll have to wait and see to what extent they consider the concerns raised by State governments, consumers and experts in the energy sector. 

 

About the author: Stephanie Gray is the Energy Strategist at Solar Citizens, a Queensland-based solar community group.

The views and opinions expressed in this article are the author’s own, and do not necessarily reflect those held by pv magazine.

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