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NSW Solar Bonus Scheme Gross Feed-in-Tariff Burns Fast, Bright – and Out?

August 27, 2010

This week the NSW Minister for Energy, Paul Lynch, announced that a review of the NSW Solar Bonus Scheme – the Gross Feed-in-Tariff – has been triggered. 

The programme, which specifies a 50MW installed threshold within the legislation, now faces an uncertain future as that target has been met well in advance of expectations.  It was only introduced in January of this year.

The scheme pays $0.60 for every kWh produced by a system, and is the most generous in Australia. 

A standard 1.5kW domestic system generates approximately $100o per annum over seven years – meaning that the total cost to taxpayers of direct subsidies will already amount to $21,000,000 with the beneifts going to just 30,000 households.

With about a third of this subsidy being sent to off-shore PV cell manufacturers, and evidence of past subsidy-gouging by the solar industry, the net benefits from a policy perspective are in question.

There will be pressure for the program to be axed or significantly altered going forward.

Submissions are due by the end of September, with the review being tabled in parliament thereafter.

Press release and submission details can be found here.

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