With the continuing downward trend of feed-in-tariffs across the country, the question on everyone’s mind is the feasibility of solar moving forward. While the ‘premium’ tariffs are a thing of the past, going solar still makes financial sense to Australians.
What is a feed-in-tariff?
For those who don’t already know, a feed-in-tariff is an agreed amount paid to you for any unused electricity generated by your solar energy system that is fed back to the main electricity grid.
Many electricity retailers across the country have introduced a feed-in tariff (FiT), which credits you on your power bill for energy your solar system generates that you don’t use yourself.
With more Australians’ enjoying solar on their homes resulting in more power being exported to the grid, we have seen a decline in the rates of feed-in-tariffs offered by electrical retailers.
Just this April, the Northern Territory government cut their standard feed-in-tariff from 26.05c per kWh to just 8.3c. So how can solar survive without ‘premium’ feed-in-tariffs?
Is solar still worth it?
While these feed-in-tariffs impact the financial incentive and payback period associated with a home solar installation, they do not negate the financial and environmental benefits of solar moving forward.
Even with a modest 8.3c per kWh feed-in-tariff, a 6.6kW solar system installed for $8000 has a payback period of just under 5 years*. Meaning, this solar system will have already paid for itself with 5 years remaining on installation warranty.**
Why not enjoy lower power bills with the knowledge you are covered if anything happens to your system?
New technological developments in panels, inverters, batteries and consumption monitoring mean Australian’s can continue to get more out of their energy. While systems with these features typically cost more, government rebates like the Home Solar Battery Subsidy in South Australia and the Home and Business Battery Scheme in the Northern Territory offer Australians an incentive to invest in battery storage.
The Country Liberal Party in the Northern Territory have also proposed doubling the current incentive for the Home and Business Battery Scheme to $12 000 to entice more Territorians to invest in solar storage for their property.
Combining these government grants with the falling cost of battery storage and installation will continue to drive more Australians to invest in solar and continue to make it economically viable.
On September 22nd, Elon Musk claimed that Tesla batteries will reduce in cost by 56% over the next 5 years through improving the design and manufacturing process. If this is true, and other manufacturers follow Tesla’s lead – the future will continue to look bright for solar.