Quote from Lance Balcombe, head of Tas networks.
“The issue is that people who have solar still use the network but their electricity tariff is based on a volumetric basis – so they actually pay less for using the network,” he said.
They could argue that they use the network less but the issue is that we still have to recover our revenue from both solar and non-solar clients – so there is a degree of cross-subsidisation.”
The problem with this statement is that it is factually incorrect. Firstly, solar owners pay for the electricity they consume and the network costs associated with that. The fact that the draw less power from the grid because they are generating their own is of no consequence. Second the power that is fed into the grid is sold on to their next door neighbours and the network cost are paid for there. Yet there is no cost incurred by Tas Networks because the power only travels a very small distance.
To explain this simply, power cannot stand still. If a solar system produces more power than the home or property needs, it is fed to the grid. It travels to the nearest point which requires that power. This power is already low voltage and refined. It is ready to use so to speak. It does not touch any of the high voltage wires or stations and it only uses a very small portion of the distribution system. Solar owners do not contribute to the cost of the high voltage transmission system at all. Therefore they should be credited that part in the Feed in tariff. Then there is a portion of the distribution system that they SHOULD pay for. Save our soar Tas.org has never said exactly what portion that should be. That is for the Regulator to determine. But if solar owner only use say 1-2% of the network, then it is easy to work out which end of the spectrum the credit in the Feed in Tariff FIT should be.
The fact of the matter is that the solar owners of Tasmania are subsidising the price of power right now. That means that the price of power is lower than what it should be because they not only have to pay network cost when they buy power from the grid, they also have to pay network costs when they give it back to the grid.
HEARTLESS
Mr Balcombe’s statement to the press appear to be nothing more than protecting Tas Networks revenue stream. It is blatantly obvious that the distribution company is double dipping on the network costs. He also seems to think that it is solar owner who should pay the penalty for the fact that the method of collecting their revenue is grossly unfair. We must not forget that high consumers of power in Tasmania are not paying their fair share of network costs. Those who use the network most are paying the same rates as those who hardly use the network at all. Also those who reduce their energy bills by reducing their consumption are also being penalised. Tasmanian households are purchasing energy efficient products in droves by moving to other forms of heating like wood and gas and also installing LED lighting. These are major contributors to reduce consumption. Solar is just one of the many methods consumers are using to reduce their power bills. The reduction in consumption is not exacerbated by solar owners. The fact that the power companies have upgraded the network unnecessarily to meet a demand that is not there is the reason why consumption is down. This has increased the price of power by an enormous rate in the last 5 years all because the network upgrades that Tasmania didn’t need, have to be paid for.
Just because the system of recovering the costs of the network is completely archaic and flawed, does not give Tas Networks to excuse or right to penalise solar owners for what is a legitimate claim. Fix the system if you have to. Do not come out in public and say that low income earner are subsidising solar owners. Low income earners are in fact subsidise high consumers of power like big business. But that is another story.
John Thirgood, www.facebook/saveoursolartas
