The minimum feed-in-tariff for solar will rise from 5c per kilowatt hour to around 6.5c per kilowatt hour – and at peak times to around 8c per kilowatt hour – from 1st of July 2017.
These changes, announced by the Victorian Government last week, are welcomed by the Hub Foundation as it means that households will receive a feed-in-tariff that – for the first time – reflects the environmental value of solar. This will be followed in 2018 by a further increase that recognises the value of rooftop solar to the network.
This is the first time that the solar feed-in-tariff has increased in 6 years, said Jo Kaptein, Project Officer at the Hub Foundation.
We see it as a step in the right direction. Whilst this increase isn’t going to be worth a huge amount to households, at least it means that there is now a structure in place for calculating the true value of solar to the environment, society and the grid, Jo said.
Reflecting environmental benefit
The new solar feed-in-tariff structure will mean that the average price paid for solar exported to the grid will rise from around 5c/kWh now to between 6.5c/kWh and 7c/kWh. This reflects the avoided greenhouse gases, and in the absence of a carbon price, is based on Victoria’s energy efficiency scheme. The price paid for solar exports may go higher, to around 8c/kWh to reflect ‘peak rates’ – from between 3pm and 9pm.
The network benefit will be added from 1 July 2018 after a report from the Energy Services Commission is completed next year.
What this means for households
Solar households on the transitional and standard feed-in-tariffs (current getting around 25c per kilowatt hour) will receive a minimum of 5c/kWh when those schemes end on 31 December 2016 – although some electricity retailers may offer a few cents more. Those on the premium feed-in-tariff will continue to receive 60c/kWh until 2024. See the table below for how you will be impacted.
How you will be impacted
| Current Feed-in-Tariff | End date | Feed-in-Tariff between 1 January – 30 June 2017 | Feed-in-Tariff after 1 July 2017 | Number of households affected |
| Standard Feed-in-Tariff – one-for-one, based on the retail electricity rate paid | 31 December 2016
(started 2012) |
Minimum 5 cents per kWh | Minimum 6.5 cents per kWh | Unknown |
| Transitional Feed-in-Tariff – minimum 25 cents per kWh for excess solar electricity fed into grid | 31 December 2016
(started 2011) |
Minimum 5 cents per kWh | Minimum 6.5 cents per kWh | 67,160 |
| Premium Feed-in-Tariff – minimum 60 cents per kWh for excess solar electricity fed into grid | 1 November 2024 (started 2009) | Minimum 60 cents per kWh | Minimum 60 cents per kWh | None* |
* Solar households on the Premium Feed-in-Tariff will continue to receive the minimum 60 cents per kWh if they do not add panels to their existing system or change energy retailers.