Even though feed-in tariffs (FiTs) these days are much lower than they used to be, there’s definitely still a bright side to having solar panels for your home.
Shining a light on feed-in tariffs (FiTs)
When we talk about FiTs, this is referring to the rate you get paid for sending your unused electricity back to the grid. It appears as a credit on your electricity bill and is paid to you from your electricity retailer (us). It’s usually a set rate per kilowatt hour. The exact rate of FiTs that EnergyAustralia is currently paying in Victoria, NSW, ACT, QLD and SA can be found here.
High in the sky rates
Not that long ago, solar energy feed-in tariffs were being offered at very high rates, especially when you compare to today’s rates. FiTs of up to 60c for each kilowatt hour of excess solar energy were not unusual.
The purpose of high FiTs was to encourage the take-up of solar energy in its early days, and help make the costs of installing solar panels more palatable as it was so expensive.
Sun setting on high FiTs
As the cost of purchasing and installing solar PV systems using solar panels has gone down over the past decade, and the amount of excess energy going back into the grid has increased, wholesale and consumption prices have gone down. The energy produced is not worth as much as it has been in the past and it’s unlikely we’ll see such high FiTs again.
So why is solar still a good idea?
Although the days of high feed-in tariffs are likely over, two very good reasons remain for choosing solar systems for your home energy.
By installing solar panels and using your own energy rather than sending it back to the grid, you avoid retail electricity charges and will save money if you're using your solar while it’s generating; that is, using your appliances during the day. In Victoria, estimates show that a typical household could save around $890^ a year off their energy bill, simply by using their own excess energy. In NSW, the average Sydney household can save up to $900* a year.
You’re helping the environment by generating your own energy using the sun’s rays - renewable energy such as solar is a very cool (or hot) investment that involves no burning of fuel and no emissions from energy production.
Bonus: with costs of installing solar dropping, you could recoup it within a few years.
Some solar tips
There are some ways to get even more from your solar system.
- Running your appliances during the day to maximise those free rays
- If you’re not home during the day, use timers to set your appliances
- Do your research to find the best energy plan for you to maximise your solar energy
In conclusion, investing in solar energy is still a power move
By looking at your solar system as a way to reduce your electricity costs at home by using your own generated energy, rather than earning credits for the energy you feed back to the grid, you can see that it’s still a very worthwhile long term investment – for you, your family and for the environment.