Govt resolves cut solar price

THE NSW Government will forge ahead with its plan to abandon its 60c/kW solar energy price in favour of a 40c/kW price despite 10 days of public uproar and “robust” debate in the Coalition joint party room yesterday.

Member for Clarence Steve Cansdell said the cabinet would look at ways to support those who could prove “hardship” due to the change and the amended bill would be presented to parliament in three weeks.

Australian Solar Energy Society (AuSES) chief executive John Grimes said he was “gobsmacked” by the hardship package concept saying all 120,000 of affected solar producers in NSW would suffer hardship as a result of the tariff cut. And the administrative costs of running the hardship package would end up costing more than sticking to the contract, he said.

“This is a blank cheque which undercuts Mr O'Farrell's whole argument – this was supposed to be about money,” he said.

Mr Grimes said he and several key industry figures sat down with Energy Minister Chris Hartcher on Friday and outlined a three-point plan to save the Government at least $455 million while keeping the first 300mW of solar panels on 60c/kW.

He said the Government was using solar radiation data based on an Alice Springs model to calculate the cost blowout.

“You don't have to be a genius to know that Alice Springs is going to get a lot more sun than coastal NSW,” he said.

This amounted to a 14% over-calculation or some $232 million.

Also, the group proposed the 60c/kW price be shut off when the scheme reached 300mW as was originally proposed.

The 60c/kW price was dropped to 20c for new solar customers after November 18, 2010.

Mr Grimes said the scheme reached 300mW capacity in January 2011, but the scheme was allowed to continue to 365mW over the following months. The scheme was axed altogether about 10 days ago.

Mr Cansdell said he was among many members who objected to the retrospective price drop, but in the end no vote was put on the matter.

“I let them know of my concerns and the concerns of my constituents,” he said.

“None of us are jumping out of our skin over it and I don't blame people for not accepting it.”

Though he would not detail exactly what was said in the party room, Mr Cansdell said concerns for the new Government's reputation were certainly highlighted.

“As I've said before, ‘Welcome to Government', it's easy in Opposition to sit there and say you don't care where the money comes from, but in Government you've actually got to find the money,” he said.

Mr Cansdell said the reality was that the previous government allowed a $750 million blowout of a scheme that was supposed to cost $355 million (funded from the Climate Change Fund).

He said if the Government were forced to abide by its contracts through a blockage in the Upper House, other projects might well have to suffer including the Pacific Highway, education, the Grafton bridge or the M4.

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