Possum’s analysis of the broad policy objectives being played out in a subtle, piecewise fashion shows the political strategy of the Rudd government in the large. Be that as it may, there’s plenty of evidence of raw political cunning as well; I’d just like to point to a little policy announcement in the budget that demonstrates it. The policy in question isone that directly impacts my own upcoming spending plans - that is, to put some grid-connected solar panels on my roof, subsidised by the Photovoltaic Rebate Programme, which gives a subsidy of up to $8000 on such systems.
As discussed on a couple of previous LP threads, the rebate, while great for the beneficiaries, is in my opinion woeful public policy. To summarise, solar cells are currently way more expensive than just about any other renewable option, including wind, utility-scale solar thermal and CSP, small-scale hydropower, biomass, possibly geothermal and especially energy efficiency - you name it, it’s better value. But even if you specifically want to subsidise solar panels on roofs, it’s dumb policy, because it encourages them on the wrong roofs. For the same amount of money, you can put a lot more solar panels (and the extra support gear required) on the roofs of factories, schools, and offices, and generate a lot more power, than you can with domestic-size installations. Furthermore, if you look at what other forms of generation rooftop solar is likely to displace, it’s not coal or gas. It’s those other, arguably more promising, forms of renewable generation, because of the vagaries of the real, substantial incentive in place for renewable energy, the Mandatory Renewable Energy Target.
Whether you personally agree with that or not, it seems that there are plenty in the government who do, and decided they’d like to spike the program. But - as any thread on the topic at LP reveals - there are plenty of people who like solar energy, and like the idea of incentives to see it deployed on rooftops. So how to square the desire to stop this perceived waste of resources, with the desire not to have the supporters of solar panels - many of whom inhabit the political territory between Labor and the Greens - get too publicly upset?
Simple. You look around at who’s claiming the rebate, and you find out that most of them are reasonably well-off types. Who else can afford to blow upwards of three and a half thousand dollars on something that, even with the rebate, takes forever to pay for itself? And, then, you note that a bunch of welfare benefits have just had a means test slapped on them. Put two and two together…and put a means test on the rebate. And, surprise surprise, the market for solar systems disappears overnight, according to the linked Age story:
A DECISION to make it harder for households to receive an $8000 rebate for installing solar panels on their home was under attack last night, with one business claiming it had lost more than 30 clients in a day.
Environment Minister Peter Garrett announced in the budget that from yesterday only households earning less than $100,000 would qualify for the rebate.
Energy Matters spokesman Markus Lambert said the means test would wipe out most of its solar-panel sales in the nation’s biggest cities, saying more than 30 contracts had been cancelled after people were told of the change, with about another 20 considering whether to continue.
But it’s very hard for the rooftop solar industry’s natural friends to make a case against means testing. Christine Milne tries valiantly on Greensblog, but the subtleties of the argument - that in this particular case the long-term environmental benefits of middle-class welfare outweigh the ick factor of giving the already wealthy government rebates - are difficult to make. And, I suspect, the government will get away with killing the grid-connected solar industry without provoking a backlash outside a relatively small group of people.
UPDATE: Another report from ABC news. The report also nicely demonstrates the level of technical expertise amongst the average reporter and sub-editor covering this beat - they illustrate it with a solar hot water system, which has nothing to do with the solar panels covered by the rebate 
That’s all fine if the subsidy that was going into solar was transferred elsewhere. But the big beneficiary is ccs which most of the environment movement regards as a boondoggle at best and dangerous at worst.
Given they’re not even fulfilling expectations for support for renewables elsewhere its hard to argue that anyone else is getting the money that was going to go to the people buying the solars.
I’m earning way under the $100,000, and even counting the whole household we would qualify for the rebate, but its clear that at some of the suppliers will go out of business, and quite likely prices will rise so those like me who were considering it will drop out as well. So the evidence may soon be there that rooftop solar is dead, and if the government doesn’t have a whole lot of other renewable industries booming along to replace it by 2010 things could get ugly for them.
Robert, funny you should bring this topic up.
I was just listening to ABC National which had Christine Milne from the Greens and Don Henry from ACF deploring the cut.
Henry’s point was that it would hinder research and larger scale production that would in the long term bring the price of solar panels down to a viable level and that the rebate was effectively helping a vital fledgling industry establish itself but that is now less likely to happen.
Now normally I would support both Christine and Don but despite the points they make I think they are on the wrong track here.
A vital pont is that I understand that solar panels generate as many or more greenouse gases in their manufacture as they will save in their operation. No gain to the environment.
Is that correct?
It would also seem to me that the aim should be to place them where they will operate most efficiently, that is high sunshine areas.
So really the question of the income of the buyers should be an irrelevancy,its a question of where rather than who, the critical factors are to have solar panels generating less greenhouse gases than their equivalents including the manufacturing.
So is there a way in which we can have government policies that [1] lower the cost of the panels to the environment [2] lower the dollar cost by increasing the scale of production and whatever else it takes [3] place whatever results in areas of maximum benefit?
Your thoughts?
Wot FS said. Killing it off stone dead and not replacing it with other PV initiatives kills off the local businesses and expertise in this area. Stupid I reckon.
I’d also point out that one of the most useful things higher income earners can do is put their cash towards a solar PV system. As higher income earners generally purchase more, run more electricity goods, it makes a certain amount of sense to encourage them to put some money into reducing their energy demand on the system, and it does also encourage others to consider it.
It also ignores the fact that there’s beena growing movement of people in close communities to all get solar -grid connected as part of distributed small scale energy systems (eg several households get PV and share in the cost of a wind turbine to make up the rest); and cuts the knees out from regional & remote communities as they also axed the scheme to encourage that as well.
The rebate wasn’t a particularly expensive thing to offer overall in budgetary terms, and it’s hypocritical to set the means test for it below the $150k set for adding yet another kid to this overpopulated world.
And it’s just plain weird to see some here thinking its a good thing to kill it off but remaining silent on the green loan scheme -pretty much same diff - no means test though!
I think for me I wouldn’t mind them cutting this off at the knees if it a) was replaced by something much more sensible like extending the reach of solar hot water systems which are much more affordable, have a much quicker payback period and make a substantial contribution to lowering household energy costs and/or b)proper national feed in tarriff laws and other measures to seriously encourage the growth of medium-large scale rollout of PV and c) it wasn’t so bleeding obvious that removing this comparatively small amount of domestic subsidisation for solar isn’t going to kill the local industry. Just short-sighted stupidity.
Well I think they did this because they wanted to be seen to be tough on the rich (like with other parts of the budget).
One alternative to the upfront rebate is to have better feed in tariffs. And these can be revenue neutral for the government as users of electricity end up paying for the higher power costs. However I think its important to make these schemes accessible to businesses, large and small, as they are the ones with the large rooftops where generation is more efficient.
I also think that these schemes should not be specified in terms of solar, wind, etc power but instead any generation scheme which produces less than X kg of CO2 per kWh. No need to pick winners here. Solar has a lot of potential, but given there is large worldwide market for solar cells, many of the gains in mass production can be done overseas.
Rather than subsidizing the well-off to pay for renewable energy and pump it back into the grid, the governments, state and federal, should be generating renewable energy and pumping it into the grid.
Some of the Greens (and most of Labor) have it wrong. Energy generation is a collective responsibility, not an individual one. Energy generation by renewables should be mandatory, not voluntary.
I agree that rooftop solar is a very expensive form of renewable energy, but in the absence of any good policy (carbon tax, ETS, MRET with bite) it seems crazy to kill the nascent PV industry to save 0.0001% of government outlays.
The sensible thing to do would be phase out the PV rebate in 2010 when the ETS begins operation (given that they don’t just hand out billions worth of free emissions to the big emitters, which they probably will).
No. Most of the analyses I’ve seen put their life cycle emissions at a small fraction of those of fossil fuels. Most will produce energy for at least 25 years - probably more, and produce as much energy as was required to make them in three or four years.
The question is whether we want to continue subsidizing solar panels at all, given that there are a lot of other, arguably more promising technologies, including solar ones.
If you specifically want to subsidize PV power, a feed-in tariff, set high enough to make big, efficient installations of hundreds of kilowatts or bigger economic, but low enough so that high-cost low-value home installations aren’t, would be the way to go. Make sure the difference between the feed-in tariff and the going rate for renewable electricity is paid by the government, not the power companies. Cap the subsidy at some point.
Voila, the solar companies stay in business, the tech gets subsidized, and we get the biggest bang for the buck possible.
One of the advantages of subsidisation to the rich is that you get the rich to voluntary throw their own money in, even though its not a money making proposition for them as they get the warm fuzzy feeling of being green (same goes for businesses where they’re willing to pay a bit for green credientials). The government could do it themselves, but it would cost more and extra taxes would be unpopular.
It is pretty amusing to see the Greens promoting the public subsidisation of private power generation
Hannah’s Dad said: “A vital pont is that I understand that solar panels generate as many or more greenouse gases in their manufacture as they will save in their operation. No gain to the environment.
Is that correct?”
This myth keeps popping its head up no matter how many times it is put straight. Do they print this rubbish on the side of milk cartons or something?
Solar PV panels will return their energy input in less than 4 years including mountings and invertor. Solar PV will operate for 30+ years.
On the general point about the rebate means test I am very disappointed by this change. The creation of a cadre of solar retailers and qualified installers over the last few years was promising. This will kill the PV industry in Aus. Who would invest their time, energy and money in this industry again. There’s just no certainty. It’s one thing to be against a solar PV rebate scheme before it starts but once an industry reaches this point it’s just bastardry to pull the rug from under it like this. While carbon pollution has no cost solar power of any type can’t compete.
Also remember, this was a rebate only. Everyone who installed a system put in their own money. That’s scary. People understand cars and plasma TV but solar PV is still mysterious. I know from experience that the rebate I received made the decision easier but I still had worries because it was such an unknown. After it was installed I kicked myself for not installing earlier. We will install a larger system on our new home and I was already not expecting a rebate the second time around. I have sold a half dozen people on solar PV, most of my family. All are very pleased now but still had the same apprehensiveness initially. All were motivated by reducing their carbon footprints. I guess we’re bred for action, not just talk.
There are all kinds of nonexistent alternatives that have a better return on investment but it’s mostly just talk. Solar PV, solar hot water, less car use, etc are ways of saying, “I’m moving on climate change, where the hell are you, you useless b*stards?”
Is the aim to encourage the solar industry or to reduce carbon emissions? Make your mind up and then formulate the policy. The current one does not seem to know what it wants to do.
If you want to encourage lower emissions, then subsidise any method of lowering emissions by the amount of carbon output saved (or, more sanely, just tax carbon emissions). If you want to encourage solar (for some odd reason) then subsidise the industry. The current method (to me at least) just seems designed to try to discredit the whole idea of cutting emissions - something it seems very well designed to do.
It is pretty amusing to see the Greens promoting the public subsidisation of private power generation
Not really when you read the Party’s policies and realise that the aim is to encourage distributed energy networks, not reliance on single massive energy generating systems.
Hannah’s Dad -
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Do you really have a daughter named Hannah or is that a reference to Special Topics in Calamity Physics?
One of the problems with the domestic home solar systems is that they automatically disable themselves when mains power fails. They don’t supply power to the grid and they don’t even supply power to the home itself if there is a power outage.
But my comment was more about how anti-privatisation they generally are, not about distributed energy generation.
Sorry that was OT. Hit the submit button too early.
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I wonder of these subsidies simply create a cushion for certain industries and impeded the development of viable alternatives to fossil fuel technology. Solar power’s come a long way but it’s got a way to go to replace coal. If the government makes it mandatory doesn’t that take away the incentive to innovate and improve?
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A lot of green policies just seem to be exercises in being seen to be doing something as opposed to actually doing something. Indicative of the fact that governments still aren’t taking it seriously.
Robert,
I’ll buy your argument once the perverse incentives supoorting greatly FF consumption have been weeded out of the tax system. Meanwhile I would support non-means tested rebates.
Has anyone noticed the projected budget surplus would buy a path to a low carbon economy?
Roger: two wrongs don’t make a right.
As I said, the solar rebate doesn’t encourage renewable energy development overall, it just displaces development from other, cheaper renewables (mainly wind) to solar.
On its positive angle, peak solar production on days of extreme heat, if the generator does not themselves have a supersonic cooling engine on their roof, could be quite positive. Depends how close a place gets to black or brown-outs and how many PVs could offset a threshold.
I am aware of the economic efficiency / opportunity cost argument and note that it is in part a product of limited resources, but also technological cost at a particular time. I know you (RM) think the tech opportunity for PV is limited in the long run. It will always be niche and my preference is solar thermal but I’m not against subsidies that have broader aims. Note that water tanks aren’t economically efficient when water is cheap, but they are when costs go up and especially the tank buyer places a high value on their home garden. Economies of scale chnage in systems under stress.
Does anyone have the marginal cost per tonne of CO2 for a typical PV set-up in terms of the CO2 it offsets? I would be interested to compare that to various estimates of the social cost of carbon. Up front and operating costs, with tonnes saved CO2 per annum would do me, and I’ll allow 4 years to “buy back” the embedded carbon in manufacture if some-one can give me those numbers.
Well now that I have been informed that PVs are a positive force for cutting greenhouse gases then I reckon we should encourage their increasing usage in all ways possible. Including giving the affluent rebates, I’ve changed my mind on that.
I should have known that Christine and Don would be on the ball. After all its only money being put to a good use, consider it attitude changing and advertising.
Adrien:
I really have a ‘daughter’ called Hannah. Black kelpie-collie cross, named after Hannah Nyala if that means anything to anyone/you. I was just reading on the couch, watching it rain here for the second time in months with her head on my feet. Happiness is a warm dog.
I don’t support subsidisation of water tanks unless the water collected by those same tanks is subject to the same water restrictions that mains water is. Otherwise we’re just subsidising people’s gardens which isn’t necessary if people put in appropriate plants. Its much cheaper to subsidise water efficiencies and larger mass storage than dinky little tanks in people’s backyards. But the rebates directly to the homeowner (much like PV) are way better at buying votes.
Robert - re: the update - the solar hot water system rebate is also means tested to $100,000 though I think this was done by the previous government. I think this is especially stupid as solar hot water systems are one of the most efficient (cost-wise) ways to reduce CO2 emissions.
To make the calculation easy, here’s some per kwh prices for solar electricity.
Domestic solar comes at about 38 US cents per kwh, or around 380USD per megawatt hour. That’s roughly $0.40 AUD per kwh or 400 AUD per mwh. Domestic retail electricity is maybe $120 per megawatt hour. Assuming that the domestic electricity all comes from Hazelwood in Victoria (the worst of the worst) produces about 1.55 tonnes of CO2 per megawatt hour.
So, even making very, very generous assumptions (and not counting the life cycle emissions of solar), it costs $280 to eliminate 1.55 tonnes of emissions. That’s a cost of eliminating emissions of around $167 per tonne.
On the subject of solar hot water systems… what is the rebate? I have an easter brochure from Origin which listed a full installation price of $2199 for a system. They do not explain how much the rebate is, as part of the total price, which is a bit deceptive. Still, if you were to replace your present gas furnace, it seems a pretty reasonable price.
As one who has been involved in the PV industry since 1987 I can say with some authority that subsidies on PV modules, Inverters or whatever are exactly the wrong way to support the PV Industry. All you do is reward incompetent and lazy design. The real cost of PV systems on a dollar per Watt basis has not declined significantly since the schemes were first introduced in Europe 20 years ago.
The real market explosion came about when mandated “feed in” tarrifs were introduced in Germany. The capital subsidies however have meant that the system costs have not declined very much if at all. Now the European governments will happily pay the a group of rich middle class burgers a subsidy to put a few hundred kW of PV on an old factory roof some-where and guarantee them an income from it for the next 25 years.Nice work. Meanwhile the cost of systems has been maintained constant despite the installation of 9GW of rooftop PV in the past few years. There is something strange here.
Huggybunny
joe2 - details are here
Note that if you’re replacing a gas system you’re out of luck. The rebate is only available for those replacing electric systems. In fact CO2 emissions from a gas based system can be about the same as a solar hot water system which has electric boost, as in many places in Australia in winter you’ll need some form of supplementary heating.
That comes out at A$45 per tonne of carbon. A survey of the social cost of carbon was carried out for the UK Treasury before the Stern Review and used by Stern although he chose a number high in the range (for various reasons). (Done by Paul Watkiss and colleagues)
If we compare this with the mean estimates from a range of studies, they suggested from ₤46 to ₤80 in 1990 prices. Using a conversion of 2.2, this comes out at $97 to $176. Of course the spread was huge, with values as low as slightly positive (ha!) to ₤300. The preferred damages of most of the conventional cost-benefit wielding economists is at the low end of this range.
When carbon trading commences and the price settles after the usual boom and slump, the price will likely be much lower that this. Robert has said there are cheaper ways to reduce CO2 than PV - I agree.
Though on this basis, dear reader, if you use PV you will be out of pocket, but the world might sneak ahead a little. Or you could multiply the benfit by spending your money on something with a little more bang for your buck.
Despite this, adding the benefits of avoided damages changes the overall benefit/cost relationship - it just does nothing for your cash flow right now!
Not if you have GreenPower
My experience with Edwards 380L Titan is you’ll need to turn on the booster if its cloudy for 1 or 2 days any time of the year. I have plenty of hot water even in winter as long as its sunny for a few hours during the day, but I’m only 28 degrees south.
Huggybunny: to be fair, the capital cost of other types of energy has roughly doubled recently, so solar’s not doing as bad as you might think.
Roger: that was about the most favourable version of the calculation possible, because I assumed that we’d displace the most carbon-intensive generator in Australia (and possibly the developed world). In practice, it’s peaking power that’s likely to get displaced, and that’s mostly gas AFAIK.
Looks like I got my paperwork in in time! Hooray, I get the free lunch.
The Age article says they’re anticipating a drop from 15 000 installations to 6 000. Now while those figures are plucked out of the air, it notionally represents a saving of $72M.
If you had $72 M to spend on decarbonising the Australian economy, what would be the biggest bang for your buck?
Thankyou, Chris (a different one) The news is not all bad. Rebates from states must be included, i just found out. In Victoria, for instance, Rebates range from $480 to $1,500 for residential properties on solar hot water systems with… no means test.
See this page from sustainability vitoria that gets down and dirty about all the different solar hot water systems available.
[link]
I would guess energy efficiency measures - education, improving insulation in houses, adding shading to north facing windows, double glazed windows in cold climate areas. Not sexy, but but much better bang for buck compared to power generation systems (of any kind).
“If you had $72 M to spend on decarbonising the Australian economy, what would be the biggest bang for your buck?”
Authorised installers of decarbonising products always seem to be the big winners.
Things that can be done without the large glad hand of glorified middle players would save bucketloads. For instance, insulation rebates could be paid at the point of purchase for the actual product.
The carbon offset tender I was just marginally involved in had the cheapest carbon offsets at $8.5 a tonne, for replacing incandescents with CFLs (personally I reckon it’s dodgy accounting). Others ranged from $12 to $25 a tonne. All for offsets however, which is not the same story.
Funny, the ad on this thread for me states that “life starts at 258 kW” for a 5.0l V10 engine.
hmmm.
Close a coal mine or two?
The thing that is pretty funny about all this, is how John Howards’ most extreme and desperate pre-election bribe has become something to be protected “at all costs”….
If you have an income above 100.000 bucks and you missed out on this one, you were just not concentrating. No sympathy and just get your eye back on the ball.
Hmmn. Me thinks if they wanted to actually torpedo the nascent solar PV industry in Australia, they have done a good job. It’s another Catch 22. Households with over 100K combined income have enough discretionary income to consider installing panels, but will now think twice (I personally know of at least 2 friends in this category).
Combined with the Catch 22 Victorian feed-in tariff (you are not allowed to put enough panels on your roof to get any significant feed in), Federal and Victorian Labor have effectively killed the domestic PV industry.
Robert, its a false dichotomy to say that the money would be better spent on wind or other sources, or efficiency measures. They are not mutually exclusive, we should do them all, viz:
* Rebate on panels with no means test, until emissions trading starts or $9b fossil fuel subsides are removed.
* Feed in tariff
* Energy efficiency programs
* Measures to prevent burden falling on low income households - e.g. Govt funded and owned 1kW solar on their roofs.
* More wind, large scale and small scale
* More “good/waste” biomass (NOT forest woodchips or ethanol from grain or sugar)
Any measures that reduce emissions are good. This government is not taking real action on climate change. It is pandering to the coal industry and mining union (CFMEU) with massive immediate handouts for coal r&d, and nothing of consequence for renewable energy apart from weasel words.
Chris @ 14
This is deliberate and regulated. The grid is either on or off, systems are set to stop feeding in when it is off. If you have batteries and the right inverter then your house keeps running. Most grid interactive systems can’t do this though.
Yes and batteries are very expensive and don’t have a great lifespan either. I imagine you’d also need some smarts to handle the situation where the system simply can’t handle the load as often brown out situations will do more damage to your appliances than a blackout will.
You do get a better return with different choices though, so it makes sense to try to find the ones that will reduce CO2 the most at least cost.
Craig Emerson made the point on Lateline tonight that they are spending $650 million on renewables quite apart from the PV subsidy. Just sayin’.
That would be $650 million on coal. The itemised actual spend on renewable energy is nowhere near that amount; it is probably around $200m including the now gutted rebate. There is a big difference between what the Government says it is spending and what they actually are spending.
The Howard Government was making similar claims during the election, but or course providing no itemised list or actual evidence.
Never confuse motion with action.
Just some simple facts - solar panels take 17 months of the energy they create to win back the energy used in their manufacture - so you get another 30 years of clean energy.
The government had overspent the allocated funds for the rebate by 20 million because the program was “too successful” so they stepped on the brake.. and stuffed the industry big time.
Then they weant and gave buckets ($500 million) to “clean coal” and the car industry as subsidies.. It’s a shame that this budget was called the climate budget - what a con.
In the next few weeks a new inverter is coming out from SMA which will allow the solar grid connect system to continue supplying the house - even when there is a blackout.
Reminds me of Howard’s “too successful” MRET.
Robert Merkel: I take it from your opposition to small scale residential PV, you don’t buy the whole electranet idea that was popularised by Al Gore a couple of years ago? A smart grid, domestic micro generation and V2G were all part of the electranet concept.
Similarly, I suspect you’re dubious of the benefits of installing millions of residential water tanks. Yes?
I hope that once folks have thrown their hands up in the air, that people will look at reality of the situation. We still have a generous grant towards installation of solar panels. And low interest loans will be available at the end of the year. Maybe its time for those on incomes below $100000 to get in on the action and embarrass the government by more high take-up.
Say one was to go for the entry level 1kw system and you could get a number of like minded punters in your area to go for it- as has happened in Ballarat- you could bring the cost and installation price right down. Paying off say 3 grand at low interest over a few years would not be too difficult for some.
Obviously one of the important reasons why people might choose to go for it, is backup for when normal power goes down. It happens a lot where i am and with more extreme weather conditions, it is likely to get worse. The inverter that Mark mentions @42 would be an important part of persuading like minded individuals to get involved. Mark does that mean the battery back up system would not be needed?
Nope, not in the short term. The wear on the batteries is far more costly than the energy returned to the grid for everything except, perhaps, spinning reserve. I do buy the idea of PHEVs and BEVs selectively recharging when electricity is cheap, and using smart meters to do that, which gives some of the benefits.
As far as water tanks go, they’re a waste of money compared to, recycling, desalination, or simply buying water from farmers.
“As far as water tanks go, they’re a waste of money compared to, recycling, desalination, or simply buying water from farmers.”
Robert ,we would not have a garden without our water tanks. I have never regretted the one thousand dollars spent (without any rebate claimed, because you need to pay off the plumbing mafia). Apart from the convenience of watering at our time, rather than when the water company allows, we have also had the joy of smallish blowup backyard pool over summer.
Coincidentally our tanks just filled to the brim overnight for the first time in ages. Hooray.
Firstly the battery based systems that use PV have been around for 20+ years, the SMA unit must have energy storage - it is not new. The problem here is that lead acid batteries will not cut it. Other energy storage systems have problems. (Such as a propensity to catch fire).
This whole subsidy thing had a precursor in Germany about 10 years ago when the Government changed and the subsidy was withdrawn. Dozens of German PVcompanies went bankrupt.
More later.
Huggybunny
We can’t afford desalination. We don’t have any spare green electricity capacity.
Is it not possible to desalinate using solar power (not necessarily using solar PV)?
I think everyone misses the point…
Owning a solar panel and water tank makes people feel special, and therefore contributes to social happiness
So true David @ 50. I get such a buzz when those tanks fill. God knows what i will do, in the shower, when that other kind of panel, is keeping the water hot.
I can see very little reason why any house should not have a hot water system installed without a solar component, even if it is just when the present one packs up. More bang for your buck, environmentally and financially, than pv’s, if the guvmint prefers to remain stingy on climate change issues.
There are some cases where its not appropriate - eg where large trees which can’t be removed overshadow the roof. Making it compulsory or having the wrong incentives can lead to silly installations - I’ve seen houses with the solar hot water or PV systems pointing east for example.
joe2: as I’ve argued at length, whether we have desalination or not we will have to radically decarbonize our energy supply.
Desal, even if it were to supply our entire urban water needs, is such a small component of total electricity use it’s essentially lost in the noise.
The Melbourne desal plant, which will supply a third of Melbourne’s water will use in the order of 90 megwatts in operation. The Portland aluminium smelter, if I recall correctly, uses 720 megawatts day and night.
That was my other thought about how best to spend $72M decarbonising Australia: Close a smelter, especially a smelter powered by brown coal.
It may not be rational, but I think this is a very important point. A lot of us feel immense frustration at the lack of government action on climate change, and at least by installing solar PV, solar hot water and water tanks we feel like we’re doing something. Obviously, you should cut your energy and water usage first, sign up with GreenPower second, but making your own electricity and hot water, and harvesting your own rain water is very satisfying.
Which at the moment means nighttime coal power, but in the future might mean nighttime nuke power, or perhaps summer midday solar, or even southerly-buster wind power?
Robert (Peterc, wilful, Roger Jones etc)
Slightly off topic but…any chance you could do a blog some time on carbon trading / forestry? I confess it’s all a bit beyond me, but would be interesting to see what other posters with a forest interest think about it.
This article in The Age today refers to forestry: A chance to shine on climate policies. Here’s a quote: “In essence, what NAFI is telling Rudd is that climate change has the potential to largely end Australia’s emotional debate over logging and even wood chipping, producing not only good emissions results but a vastly expanded forestry sector, renewable energy, indigenous forestry, new pulp mills and a reduction in our timber current account deficit.” [link]
And here’s a link to the NAFI web page where there is a link to their Garnaut Submission: [link]
Robert, I disagree with this statement. Recycling, desalination and transporting water from farmers (if they have any; most now don’t) all involve significant carbon emissions. Domestic tank water, once the system is installed, only has small emissions associated with an electric pump, which could be solar powered to make it zero emissions.
We have been basically self sufficient for water with 23,500 litres of tanks in Surrey Hills (Melbourne) since 2001. Only added some Melbourne water on 3 occasions since then. More details [here]
If 600,000 households in Melbourne achieved this with tanks (at 5k per house, the cost of the desal plant), they would save more water than the desal plant will produce.
The word is they plan to build a gas fired power station next to the desal plant to power it too - as there is not enough windpower to run it and supply Victoria’s Greenpower scheme. 90MW more is 90MW too much.
And stopping logging in Melbourne’s water catchments will save 30-50 GL of water per year too.
We don’t need desalination, the Goulburn pipeline, or more dams. We need more recycling, reduced consumption, domestic water tanks, and to stop logging our water catchments.
90mw will get lost in the noise? Just like australia’s total CO2 pollution gets lost in the global ‘noise’. Take everything on its own and nothing matters. Put all these things together and you have a problem. Is why this whole CO2 pollution issue is so hard for people to get their heads around.
We need to preserve that 90MW worth of CO2 polluting electricity for the extra 130,000 skilled visa migrants coming next year. We can’t afford to burn coal to make water. Sheer stupidity. Cheap political quick fix, that causes more harm than good in long run and perpetuate the myth that there are techno silver bullets for all our problems.
If we can’t live in Melbourne without burning brown coal to water our leafy green gardens then we have no right to ever say a thing about China. Ever. On any subject.
I understand that Perth has one desal plant powered by renewable energy and are now building a second.
We installed one 10,000 litre tank for the pool, the garden, washing cars and such. It cost about $3,500. Our second tank, 6,000 litres plumbed into the laundry and the toilet (all that is permissible in Brisbane) was harder. It cost about $6,800.
That’s without subsidies, which we got.
We did it all because this time last year Brisbane was facing Armageddon. Dam levels were 16.75% and would have emptied about 6 months before the desal plant and recycling etc came on stream.
It rained last summer and now the dams are about 37.5% and falling. We are still on Level 6 meaning <140 litres per person per day.
Tanks mean to us that we can wash the car, water the garden, even hose the driveway and get our consumption of town water down below 70 litres pppd without going out of our minds. It was a definite ouch financially, but ’tis done now.
I’ve seen about a dozen tank installations and more than half have major problems, like pathetically small for the intended purpose or attached to a gutter but the water runs the other way. So I’m fairly negative about retro fitting in general.
From memory there were about 200,000 installed last year when it rained. They calculated that the water collected was equivalent to one day’s supply.
By using the money to build a more efficient aluminium smelter or one close to more green sources of power? The aluminium (commonly known as congealed electricity) is going to be smeltered somewhere in the world.
For water from farmers in many cases you don’t need to transport it, you just pay them not to take it out of the river upstream and collect it downstream like you normally do (depends on where you are of course).
Mainly because our priority was on water we hadn’t done anything about green power until today. Today we signed up with AGL to supply our gas and electricity. We use gas for hot water only.
The green energy deal was 2% of the bill, which in our case (I think we are fairly heavy users) is about $1 per week or a bit over $4 per tonne of CO2. Seems cheap to me. We have a 12 day cooling off period when we can change our minds. Should we?
Generally I’m inclined to agree with Robert on this one though I can see the emotional/PR/political argument.
But I’m concerned that here too Labor has cut industry off at the knees in a peremptory fashion.
There was an article in the Fin Review suggesting that the Govt is holding off with it’s renewables initiatives waiting to see what comes out of Garnaut and what the emissions trading regime will look like.
Is that some carbon offset deal? Otherwise that sounds like very cheap renewable energy. The greenchoice deals that ActewAGL run cost almost 40-50% more per kWh of power - say a $1 day if you’re consuming 20kWh/day.
My problem with that Brian, is that the desal plants are actually not powered by renewable energy. The WA grid is 0.4% renewable. Therefore the the desal plants are also 0.4% renewable. The other 99.6% of that water is manufactured in a CO2 polluting process.
(0.4% is according to Wesfarmers who are the main electricity generators in WA.)
Yeah, both even … like building a new, super efficient smelter in Tassie or New Zealand, where there’s a lot of hydro. In some future integrated Aust-NZ carbon market that kind of thing might benefit all.
wbb, re desalination in the West I was going on ABC news items I’d heard. But here is Geoff Gallop in 2005 announcing what seems to be a direct link between a wind farm and the desal plant.
Here’s Alan Carpenter announcing tenders for the second together with an ABC news item on the same topic.
It seems that these arrangements bypass the normal electricity supply.
Chris at 62, we are using about 28 kWh/day. As I said, we are on the high side. We do try, but we pump a lot of water in the swimming pool, (which we’ve considered turning into an underground rain water storage tank, but that’s mega expensive), and have three refrigerators, one room airconditioned and need quite a bit of heating in the winter (high set wooden Queenslander, with batts in the ceiling).
We have one brochure from AGL saying that they produce a third of their generating capacity from renewables and hope to double it by 2012. A second brochure says they are shooting for 80% by 2012. I think they are also involved in the NSW tree planting scheme set up with the emissions trading scheme there, though I can’t find a direct reference.
Their renewables portfolio, which they say amounts to $2 billion worth of investment, seems to emphasise wind and hydro.
The hydro is Southern Hydro which they paid a lot for a few years ago so that they could provide renewable peak load to power your air conditioners in southern Australia.
The company presents a very green face. I saw their new CEO on a TV panel on climate change a while ago and they do seem to be serious about their green agenda.
The other main competitor here that can supply both gas and electricity is Origin Energy. Their main forward strategy is in SLIVER technology and in a hot rocks joint venture with Geodynamics.
Origin do control Contact Energy in NZ (25% of the market) which is their largest geothermal producer and seem to be continuing down the renewables path by investing up to $2 billion in renewables. So both companies look to be on the side of the angels, but I’d rate AGL as in front in Australia at least.
So I guess the deal AGL are offering is partly because they are well placed to supply renewables in bulk, rather than one-off stuff on your roof, and it’s part of their long term strategy.
BTW Investorweb has a “sell” on AGL as an investment and a “hold” on Origin. Both are predicting earnings per share growth, but AGL is the biggest retailer and is suffering market share problems from competition. They are also a different company from the somewhat staid pipeline company of earlier years after fighting a takeover battle with Alinta and then merging and splitting to give the shorter story. Investorweb sees some risk in the stock, risk being in terms of the solidity of their earnings prospects.
I guess I’m questioning whether the green energy deal they are offering you results in 28 kWh of extra renewable energy being created, or if they are just saying they’re going to invest the extra money you pay into developing green energy.
I assume that ActewAGL and AGL are probably at least partially owned by the same people, so its quite interesting to see such different green energy plans being offered. I wonder if they think Canberrans are willing to pay a lot more.
btw does the offset count towards gas as well as electricity? AFAIK they only offer a green energy plan for electricity here.
Brian, wouldn’t you agree with me that this is an accounting trick? The Emu Downs Wind Farm is connected to the grid. And even if it wasn’t, when most of the states electricity is CO2 based, it is pure sophistry to hypothecate the available wind power to bolster the green credentials of the desal plant.
The Victorian government will no doubt pull the same PR stunt when they commission their proposed desal plant.
Green power is in shorter supply than water.
I think it’s a bad decision to means test the solar panels. We need to be encouraging people to put solar panels on their rooftops, regardless of their income. And of course most of the lower income earners won’t be able to afford it anyway.
Policy decisions are about priorities. An increase in the use of renewable energy is very important. Very little is being done to help the renewable industries whilst subsidies are still being given to fossil-fuel industries. The government’s priorities clearly do not lie in seriously tackling climate change.
Chris, yes the offer covers gas as well as electricity.
I think perhaps the way it works is that they are actually supplying more green energy to the grid than they have green power customers for. When they get a new customer they allocate a bit of the power to that customer (although it doesn’t physically necessarily arrive as such) and charge for the privilege.
They are doing this on the basis of offering a 5% discount from what we’ve been paying to Origin. What happened was that retail was privatised and opened up last year with AGL buying the Southside customers and Origin the Northside. Now that are trying to pinch each other’s customers, with other players mucking in. Ironically Energex stll supply the electricity and the same mob as before have the contract for meter reading. So what they are competing for is mainly marketing and bill collecting. Investorweb says that AGL had just spent $60 million on a new bill collecting/payments system. But there was never anything wrong with Energex’s bills and I don’t think anything is going to be cheaper, really.
So the deal with AGL is a 3% discount for green energy across the board instead of 5%. Of course next week we will see what Origin has to offer.
wbb, I can’t agree that it is an accounting trick because I don’t know. Maybe the desal energy is insignificant in the whole as Robert says. If they haven’t built a separate distribution line, which wouldn’t make sense, then the electricity for the desal plant is earmarked as such and isn’t double-sold to the next green power customer.
It’s the same with our green energy above. If AGL are getting our energy from Energex, then Energex don’t have much to fly with. Their own story is mainly about energy efficiency while they are “developing nine landfill gas production and cogeneration schemes in Queensland and Victoria”.
I’d suggest that the green energy we are paying for is most likely being delivered to customers further south, who are specifically not paying for it. In Quinceland I haven’t heard much about green energy production. It’s not a good wind region and there’s no significant concentrated solar, though there could be. Drilling licences to drill for geothermal are just being issued. We are the land of coal, and some gas. We’re more likely to mine shale oil than produce any significant green energy.