Sunrun Solar Opposes Proposed Solar Energy Tax by AEMC

Solar energy experts, installers, and owners have spoken out against a potential solar energy tax proposed by the Australian Energy Market Commission (AEMC).

May 24, 2021. By Manu Tayal

Solar energy experts, installers, and owners have spoken out against a potential solar energy tax proposed by the Australian Energy Market Commission (AEMC).

The proposed tax would see solar energy owners charged a fee for energy that’s fed back into the grid. For years, solar users have been able to sell excess energy back into electricity networks in return for a sum of money. This is known as the feed-in tariff and has saved solar-powered households significant amounts in energy costs.

The AEMC argues that there’s an excess of electricity being fed back into the grid and that the grid can’t cope with the levels of electricity being returned. To fight this issue, the AEMC proposes a fee for solar system owners when they pump unused energy back into the network.

While the AEMC model outlines a 7% reduction in feed-in tariff return, experts have predicted a much greater drop in returns, potentially causing losses of close to 80%. This would mean the average solar-powered household would go from seeing a yearly return of $129 to a mere $29.

According to Sunrun Solar, leading provider of solar panels in Melbourne, the proposed tax would not only have an unwanted effect on solar panel users, but would also deter new customers from installing solar panels. The appealing returns from the feed-in tariff convinced many traditional electricity users to make the switch. With these savings all but gone, there would be little motivation to change over to solar energy.

An overload of electricity in the grid would cause blackouts and energy traffic jams, according to the AEMC. The proposed tax would encourage solar energy users to store their own electricity with batteries to use at high-traffic times or pump it back into the grid only when needed.

However, experts dispute the claim that electricity networks cannot handle the extra energy. They also point out that excess electricity from solar systems poses a threat to large energy companies. By taxing solar system owners, users of traditional energy would reap savings of around $15 per year, providing more incentive to stay with a big energy company rather than opting for solar.

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