Solar export tariffs! What, more changes?

Tuesday, September 21, 2021
Training
by
Veli Markovic

Import and export of renewable energy

Essential Services commission

Currently any excess solar that is allowed to be sent to the grid has some value and, previously, as stipulated by the Essential Services commission, this rate is 10.2 cents per kWh ( a single rate feed-in tariff ) as of May 2021

A feed-in tariff is the rate at which customers are credited when they export excess generation from their small-scale solar, wind, hydro or biomass generation sources.

Single and time-varying minimum F.I.T.

Essential Services commission

Since 2018–19, ESC has set both a single rate minimum FiT and a time-varying minimum FiT rate.

The time-varying minimum FiT rate is a peak, shoulder and off peak structure. 

It was intended to reflect the underlying value of the electricity, which is based on a wholesale electricity market in which prices change every 30 minutes and tend to be higher at times of peak electricity demand.

Courtsey of https://www.esc.vic.gov.au/sites/default/files/documents/FDP%20-%20Minimum%20feed-in%20tariff%202020-21%20-%20Final%20decision%20-%2020200110.pdf

Not just solar

The feed in tariff also applies to wind, hydro and biomass as well as solar and this is why there is a F.I.T. rates for non  sunlight hours.



So how does this affect solar systems?

So one of the questions to ask is how much does a change in export tariff affect the savings with a commercial solar system up to 100 kW?

Does the company offering commercial solar as a financial proposition have to factor in changes in F.IT.’s as well as all the other factors?

100 kW system

Scenario 1

  • 100 kW system
  • Installed in Victoria, Australia
  • North facing at 10.5 degrees tilt
  • Electricity price of $0.25/kWh

We look at savings in the first year with differing export tariffs prices and load % being consumed

Can see from the table above that a change from $0.10 to $0.07 results in a difference of $2505 when 40% of the solar services the loads. As this percentage increases the drop in the export tariff rate plays less of a role.

At 80% the difference is only $835.

What about after 10 years?

Difference of $28,484!

What about at 90% load consumption?

Difference of $4747!

In the image above you can see the difference between $0.10/kWh export and lower rates at various load consumption percentages.

100 kW system

Obviously the more solar production that directly services the load the less goes out to the grid and the smaller the effect of a reduction in F.I.T rates.

As time goes on, systems will be designed with reducing amounts of solar production going out to the grid unless there is a battery storage component involved.

If you’d like to see more of what Greenwood Solutions get up to in the real world of renewable energy, solar, battery storage and grid protection check out the following pages:

https://www.greenwoodsolutions.com.au/industry 

https://www.greenwoodsolutions.com.au/commercial

https://www.greenwoodsolutions.com.au/commercial/customer-stories

https://www.greenwoodsolutions.com.au/news


About the author

Veli Markovic

CEC Designer
Veli has nearly two decades of experience in the renewable industry. He is passionate about providing people with valuable education and is highly regarded throughout the industry as an educator and operator.
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