In NSW more than 10% of households and small business premises have installed a solar photovoltaic (PV) system (commonly called solar panels). When these solar customers use the electricity generated by their solar panels rather than buying electricity from their retailer, they save money. When they don’t use all this electricity themselves, the excess amount is exported to the grid, and they may be paid a ‘solar feed-in tariff’ for this electricity.
Retailers aren’t obliged to pay solar customers a solar feed-in tariff. Rather, they can choose whether to do so in their market offers to solar customers. And if they do, they set this tariff themselves. Currently, most retailers do offer a solar feed-in tariff of between 6 cents and 17 cents per kilowatt hour.
To help retailers in setting their solar feed-in tariffs, and solar customers in deciding whether these tariffs are reasonable, the Independent Pricing and Regulatory Tribunal of NSW (IPART) has set a ‘benchmark range’ for solar feed-in tariffs for each year since 2012. This range provides guidance on the value of electricity exported to the grid by solar customers in NSW in the coming financial year.
The NSW Government has asked IPART to continue to review the solar feed-in tariffs. The purpose of this paper is to discuss the main issues we need to consider for this review, and to outline our preliminary views on the approach we will use to set the benchmark range. We invite all interested parties to comment on these issues and preliminary views.
Submissions are due by 16 April 2018.