Queensland rejects battery swap, but restricts use of storage with premium tariffs

Queensland rejects battery swap, but restricts use of storage with premium tariffs

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Queensland decides against proposed voluntary “buy out” of premium solar feed in tariffs in exchange for battery storage, but announces new rules to stop premium tariffs being rorted by batteries.

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One Step Off The Grid

The Queensland government has decided against a proposed voluntary “buy out” of the remaining 10 years of premium solar feed in tariffs in exchange for battery storage, but has announced new rules to prevent those premium tariff households from using batteries to rort the system.

rootop solar panels

A voluntary swap of premium solar tariffs, which run at a generous 44c/kWh until 2028, with battery storage had been floated initially by Ergon Energy in 2014 as a way to encourage battery storage in a state with high levels of rooftop solar penetration and growing network issues.

It was a proposal that found widespread support among the battery storage industry and the solar industry.

The Queensland Productivity Commission last year rejected the idea, saying the payment would need to be too high (on average around $9,000 per household) and recommended that any household be kicked off the premium solar tariff if it installed battery storage.

The Queensland government has decided against the buy-back, but rather than introduce an outright ban on storage in premium FiT households, announced new rules designed to prevent any rorts occurring.

 Under the new rules, such households will not be allowed to discharge batteries during the day, and will only be able do so at night time. Batteries can be charged during the day, but only discharged at night, or during grid outages.

It is difficult to imagine what the incentive would be for a household on a premium tariff to add battery storage, given that any solar power put in the battery for use at night will only offset a price of less than 30c/kWh, rather than the 44c/kWh export price.

Still, the Queensland government acted because if the system was rorted  – i.e. charging the battery at night from the grid and discharging it during the day – its advice was that more than $1 billion could be added to the cost of the premium FiT over its lifetime.

Storage had not even been considered when the system was designed less than 10 years ago, but with more than 150,000 homes with 580MW of rooftop solar on a voluntary or minimum tariff in just the south-east corner of state, the incentive for battery storage is growing as grid prices rise.

The number of households on the premium tariff has fallen significantly since the scheme came to an end, as customers lost their premium tariff if the house was sold or more solar was added to the roof.

According to Energex data for the south-east corner of the state, the amount of solar PV under the tariff has fallen nearly 100MW to 538MW – on 171,000 homes.

The total amount of rooftop solar in all of Queensland is now more than 1.72GW – bigger than even the largest coal fired power station in the state.

“Solar rooftops combined are now our largest power station in Queensland, and declining costs and technology breakthroughs have the battery storage market poised for substantial growth – just like solar PV some seven years ago,” energy minister Mark Bailey said in a statement.

“In Queensland we regularly see local energy companies, such as Redback Technologies demonstrating that battery storage technology is becoming more affordable and that opportunities for battery storage technology are immense.

“We believe in transitioning to a clean energy economy and want to promote the uptake of this new technology. We understand that batteries will play an important role in our transition to a clean energy economy, helping maintain system security, reliability and affordability.”

This article was originally published on RenewEconomy’s sister site, One Step Off The Grid, which focuses on customer experience with distributed generation. To sign up to One Step’s free weekly newsletter, please click here.

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  1. Chris Schneider 3 years ago

    First of all an edit is required “The number of households on the premium tariff has fallen significantly since the scheme came to an end, as customers lost their premium tariff if the house was solar or more solar was added to the roof.” you mean “sold or more solar”

    Second this is a silly plan, one; it’s preposterous to come to that conclusion that people would take power during the night and feed it back, two; it would create resilience on the grid and at the home. It is a great way to get the 44c off the shoulders of the grid, it’s just a big upfront payment but one Energex is quite capable of paying, and would gladly do.
    Battery connected together would create a network which would be amazing for Queensland! Householders would pay for the energy security of Queensland!

    • Miles Harding 3 years ago

      I was thinking along this line.

      Present day batteries are too expensive per kwh over their lives for this to make sense, probably just around break-even at 44 cents, so no point in doing it.

      The feed-in tariffs should be market-driven and set to encourage ‘rorting the system’ when demand is high and generation is stretched. Adding batteries means forgoing the high ‘anytime’ feed-in tariff for a market based one. This would be greatly assisted by fixing the bid-settlement distortion in the NEM and allowing households, presumably through some aggregator service, to participate on a level field.

  2. MaxG 3 years ago

    So, when the small guys rort the system, then we have to do something about it; when the big guys do it, then it is business as usual…

    • Joe 3 years ago

      …its always easier to go hard on the “low hanging fruit” !

      • Citizen Smith 3 years ago

        Especially when the big guys make donate significant amounts to the political parties.

  3. Jacob 3 years ago

    Why not simply say that any 44centers wanting batteries can have them but the FiT in their agreement drops to 30cents?

  4. Ian 3 years ago

    If you have the 44c/KWH tariff and you charge your tablet or cordless drill and use it in the day are you at risk of losing your premium FiT under these rules?

    Talk about a bunch of Palookas.

    • Giles 3 years ago

      You just made me laugh out loud. 🙂 🙂

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