Will Two-Way Solar Feed-In Tariffs Kill The Home Solar Industry?

As the solar industry continues to evolve, one significant change on the horizon is the introduction of two-way solar feed-in tariffs. This change, set to be implemented by all grid operators in New South Wales by 2025, is already generating buzz and concern among solar power users, who have heard the news. To shed light on the implications of this shift, we sat down with Darren Chung, owner of Shoalhaven Solar, to get his expert insights.

The Upcoming Changes

Darren explains that network operators like Endeavour Energy will begin charging consumers for feeding their solar power into the grid during certain times of the day. "There's a 1.70 cents per kilowatt-hour charge between 10:00 AM and 2:00 PM," he says, "but there's also an 11.3 cent credit for feeding power into the grid between 4:00 PM and 9:00 PM."

There's a 1.70 cents per kilowatt-hour charge between 10:00 AM and 2:00 PM, but there's also an 11.3 cent credit for feeding power into the grid between 4:00 PM and 9:00 PM.

This new pricing model is designed to encourage consumers to use their solar power more efficiently and to shift solar panel installations to east and west-facing roofs, maximising energy production in the mornings and late afternoons. This change aims to reduce the midday energy surplus, which often overwhelms the grid.

Impact on Consumers

For many solar power users, these changes might seem like a double-edged sword. On the one hand, there's a potential reduction in the feed-in tariffs they receive; on the other hand, the new system encourages more strategic use of solar energy.

"We've always advocated for better use of solar power here at Shoalhaven Solar," Chung says. "This change might push people to think more critically about how they use their energy. For instance, using excess power to heat water or run appliances during peak solar hours can reduce the need to feed power back into the grid."

The Role of Batteries

Batteries are becoming an increasingly viable solution for managing solar power under this new tariff system. With electricity prices rising and battery costs decreasing, the return on investment for solar batteries is improving.

Since COVID, battery prices have dropped by about 15%

"Since COVID, battery prices have dropped by about 15%," Chung notes. "A 10-kilowatt-hour battery, which costs around $8,500, can store excess energy produced during the day, saving consumers from the 1.70 cents per kilowatt-hour charge and effectively turning that stored energy into significant savings."

Alternatives and Adaptations

For those who cannot afford a battery, other options exist to optimise solar energy usage. Using devices like the Green CATCH power diverters or simple timers can help manage when and how solar power is used, directing excess energy to heat water or run appliances instead of feeding it back into the grid.

"These solutions can make a big difference," Darren explains. "By heating water with solar power during the day, you reduce the amount of energy sent to the grid, avoiding feed-in charges and making better use of your solar production."

By heating water with solar power during the day, you reduce the amount of energy sent to the grid, avoiding feed-in charges and making better use of your solar production.

Looking Ahead

The introduction of two-way solar feed-in tariffs marks a significant shift in the solar industry, one that will require consumers and solar designers to adapt. The focus will be on better system designs, optimal solar panel orientations, and smarter energy usage.

As the industry moves forward, innovations such as EV chargers and more affordable, efficient batteries will continue to shape the landscape. Inverter manufacturers are also offering more flexible options, allowing systems to be easily upgraded to hybrid inverters when users are ready to add batteries.

Conclusion

While the changes to solar feed-in tariffs may seem daunting, they also present opportunities for more efficient and strategic use of solar power. By staying informed and adapting to these new systems, consumers can continue to benefit from solar energy while contributing to a more balanced and sustainable grid. As Darren suggests, understanding and leveraging these changes will be key to maximizing the benefits of solar power in the years to come.

Talk to us at Shoalhaven Solar about how you can leverage new technologies to ensure you keep getting the best return on your Solar investment.