Solar feed-in tariff

Wednesday July 06, 2022

Mr BELL (Mount Gambier) (15:05): My question is to the Minister for Energy and Mining. This question comes from Brian Spring, who unfortunately didn't get the chance at the country cabinet to ask it, but he was adamant that I ask it for him. With power prices increasing, why is the price that Brian gets from his feed-in tariff from his rooftop solar panels decreasing?

The Hon. A. KOUTSANTONIS (West Torrens—Minister for Infrastructure and Transport, Minister for Energy and Mining) (15:05): That is an excellent question. Is it Brian?

Mr BELL: Brian.

The Hon. A. KOUTSANTONIS: I know how popular I am in the South-East, especially after the fracture stimulation debates of the 2014 to 2018 period, but he raises a very good question. What has been progressively happening over the last four years is that South Australia is producing an abundance of solar energy, a lot more than can be dispatched.

There are two ways of dealing with that situation. One way is to curtail supply, which was the previous government's plan, that is, to turn household solar panels off. The other option is to take advantage of that oversupply of renewable energy or negative demand and use it as a source of cheap energy, much like Premier Playford did when he built the ETSA power stations when we had an oversupply of base load generation at night. We insisted that hot-water systems be heated over the night period to create a demand. The reverse is happening now, where we are having what is called net negative demand during the day.

The reason the retailers are now paying next to nothing for that energy, if at all, is because its price goes negative through the energy market at those periods when those solar panels are producing electricity. What Brian needs to be doing, and should be thinking about, is offsets. We've got to start having a new conversation about solar energy and how it is used in the household. The traditional method, which was a solar feed-in tariff, was to put as many solar panels as you can on your roof, generate as much electricity as you possibly can and pour it into the grid and get paid for it to offset your electricity bills.

The new conversation has to be to use your solar energy on your roof to offset your use to not incur the bill to start with. That can be difficult, especially at night, which is why the feed-in tariff worked so well, which is why batteries are becoming so important. Battery storage is one way of looking at it. Of course, the other option to make that power valuable again is like the government's Hydrogen Jobs Plan, where we intend to establish a 250-megawatt electrolyser that will operate during the day at times of this oversupply of solar energy, which will add a value to that energy. When we are soaking up that energy, it will gain a value. When it gains a value, retailers then will be incentivised to offer a feed-in tariff to people like Brian, and that's the conversation.

I think the former government's plan to turn off solar panels was a quick knee-jerk reaction to a very serious problem without any long-term thinking. I am not saying it was the wrong decision; I am saying it was the easy decision. The hard, long-term decision is to come up with a plan that takes advantage of that solar energy, to use it to decarbonise not only our grid but our economy. That's why the Hydrogen Jobs Plan is so important—because we can harness our power in the middle of the day to make hydrogen and use that hydrogen at night.

Making hydrogen is no different from pumping water uphill. It is a form of storage, when you are using it for electricity production. Of course, it can also be used in industrial applications like furnaces and other applications in transport and heavy vehicles. There are lots of applications and there are lots of people who are interested in it. Brian's problem is a wicked one, and we are working very quickly to try to solve it.