AEMC & the 'Solar Tax'

On 25/3/21 the AEMC released a a draft determination on how to integrate more small-scale solar – and other new energy technology like batteries – into the electricity grid. AEMC Chief Executive Benn Barr said, “Within 10 years, half of all energy users will be using home energy options like solar. We must make sure this seismic shift doesn’t leave anyone behind because every Australian, whether they have solar or not, deserves an affordable, sustainable power system.”

The draft determination aims to address the problem of ‘traffic jams’ on the network, which are occurring now and will get worse as more solar connects because the grid infrastructure was built when power only flowed one way. Blocking power exports because the grid is under strain will cost us all more, because it means less renewable, cheaper energy gets into the system.

The AEMC reform package (see https://www.aemc.gov.au/) to make room for more solar includes:

• Changing distribution networks’ existing incentives to provide services that help people send power back into the grid.

• Letting networks offer two-way pricing to better manage the poles and wires.

• Flexible pricing solutions at the network level.

If implemented this means that there could be a new cost on solar energy exported to the grid at times when the network is congested. At this point, the proposal is open to discussion with feedback due back to the AEMC by 13 May 21.