PV system at Edge Hill State School, Cairns, Queensland, Australia

By Muriel Watt

National PV Support Programs

Australian Government support programs impact significantly on PV markets. The majority of current support is focussed on small systems, with the exception of the Solar Flagships program.

Solar Credits

The Australian Government has expanded the Renewable Energy Target (RET) to 45,000 GWh by 2020, as shown in Figure 1. This is expected to increase the amount of renewable generation from current levels of around 8% of total generation to 20% by 2020. The RET will continue to use the Renewable Energy Certificate (REC) mechanism, with each MWh of renewable energy generation eligible for one REC. REC multipliers, or Solar Credits, are available to PV systems, wind turbines and micro-hydro systems for the first 1.5 kWp of capacity, as shown in Table 1.

Output from capacity above 1.5 kWp is eligible for 1 REC per MWh. As well as homeowners, other organizations such as schools, community groups, businesses and developers are eligible for Solar Credits, and no means test will be applied. For PV systems up to 100 kWp, 15 years’s worth of RECs can be claimed up front, according to a set deemed output, depending on the site. RECs are currently trading at around AU$30. Thus, the RET can provide valuable capital cost reductions for small PV systems and will be one of the main market drivers in States with no gross feed-in tariffs. PV modules and inverters must meet Australian standards or specifications. This program, which follows on from grant-based support schemes, has seen a rapid increase in the number of PV businesses, training and accreditation. PV uptake levels over the past decade are shown in Figure 2. Grid parity is expected to be reached in many areas of Australia within the timeframe of the program, and PV will be a significant mainstream business by then.

Figure 1. Australian renewable energy target 2010-2030  (Source: IT Power)

The National Solar Schools Program (NSSP)

The AU$480 million NSSP commenced on 1 July 2008 and finishes on 30 June 2015. It offers grants of up to AU$50,000 per school to install PV and other renewable power systems, solar hot water systems, rainwater tanks and a range of energy efficiency measures including insulation, energy efficient lighting and ceiling fans. Some State Governments offer additional funding focussed on PV and some have arranged central purchasing as a means of minimizing cost. The 2009-10 budget allocation was oversubscribed and applications closed early. Applications will reopen in 2010. Most schools are installing PV systems of 2 to 4 kWp. The program expected to result in the installation of 20-40 MWp of PV by 2015. This program will increase awareness and understanding of PV as students move through the school system, and will also increase community knowledge and acceptance levels.

Solar Flagships

In 2009, the Australian Government announced a call for 1 GW of solar generation via 4 solar thermal and PV power stations. AU$1.3 billion has been allocated, with funding available to cover up to one third of the capital cost. Proposals are expected to include PV companies, electricity retailers, State and local governments, financial institutions and research partners. Initial bids for one PV and one solar thermal power station, with a total capacity of 400 MWp are due mid February and will be shortlisted prior to the development of detailed proposals. A second call for another two power stations will be made in 2013-14. Favorable consideration will be given to proposals which include local industry development, so interest is high in potential local component manufacture. All projects must include research programs, with funding up to AU$400 million available for research infrastructure.

Demonstration

The Desert Knowledge Australia Solar Centre is an AU$3.1 million initiative of Desert Knowledge Australia with initial funding provided by the Australian Government. It showcases and demonstrates a range of solar power technologies from different manufacturers and suppliers in commercial-scale installations. These installations provide meaningful and accurate comparisons of the performance of the technologies--in the arid environment of Central Australia, thus, improving the knowledge base for solar initiatives globally.

Australian Solar Institute

In 2009, the Australian Solar Institute was established with funding of AU$100 million over 4 years to foster concentrating solar thermal and PV Research and Development (R&D) and to accelerate commercial deployment. A first round call for R&D projects was made in 2009, with successful projects commencing in 2010. 40% of funding has been committed to core projects undertaken at the Commonwealth Scientific and Industrial Research Organization, the University of NSW and the Australian National University. Contestable funding is available for other basic and applied R&D projects. The first 5 projects to be funded are:

● University of New South Wales: Development and Commercialization of High Efficiency Silicon Solar Cell Technology. AU$3,972 million.

● University of Newcastle: Fabrication of Thermionic Devices Using Directional Solidification/Sintering Processes for High Temperature Concentrating Solar Thermal Applications. AU$515,000.

● Australian National University: Plasmonics for high efficiency Photovoltaic Solar Cells using nanotechnology to capture more light. AU$1.67 million.

● University of Queensland: New Materials and Architectures for Organic Solar Cells─Beyond the Shockley-Queisser Limit. AU$945 000.

● CSIRO and the Australian National University: Advanced steam generating receivers for high concentration solar collectors. AU$4,084million.

A second funding round will be called in mid 2010.

Solar Cities

In 2008, the Solar Cities program saw two new cities announced, Moreland and Perth, expanding the program to 7 Solar Cities. Four Solar Cities were operational in 2008: Adelaide, Blacktown, Alice Springs and Townsville, with 716 kW of PV installed. Central Victoria and Moreland Solar Cities began to roll out projects to their communities in 2009.

Alice Solar City provides a capital subsidy of up to 50% for eligible householders to install a PV system. Householders are also able to sell all electricity generated to the Power and Water Corporation and benefit from a gross feed-in tariff of AU$45.76 c/kWh, capped at AU$5 per day.

Ergon Energy is installing up to 1 MWp of PV on premises around Magnetic Island, as part of the Townsville Solar City project. Residents can volunteer their roof space and Ergon will fully manage installation and maintenance of the PV systems, as well as using the electricity generated to reduce daytime peak load on the inland.

The Solar Cities program is one of the few providing support for PV systems in the commercial/industrial sector. A 100 kWp system has been installed at the Cadbury-Schweppes factory in Blacktown, a 305 kWp system on the Crowne Plaza in Alice Springs and several 50 kWp systems for the Adelaide Solar City.

Feed-in Tariffs (FiTs)

A number of States and Territories have now introduced FiTs for PV-generated electricity, although only the Australian Capital Territory, New South Wales and the Alice Springs Solar City offered gross FiTs for total PV system output. Instead, net export FiTs operate in Victoria, South Australia and Queensland, with the feed-in tariff paid only on electricity exported to the grid in excess of on-site usage. The current state of Australian feed-in tariffs is shown in Table 2.

Future Outlook

With PV prices now reflecting the significant production cost reductions which have occurred over the past decade, and with grid electricity prices rising rapidly in most Australian jurisdictions, PV grid parity is expected to be reached in many areas of Australia within this decade. In the short term, the residential market will be driven by the Solar Credit mechanism and gross feed-in tariffs, where available. In the longer term, there will be a need to incorporate PV into building codes and zero energy building targets. Interest is growing in the commercial market, where daytime electricity use is growing fast and contributing to peak load problems. The market for central solar power plants will be stimulated by the Solar Flagships program. The off-grid market remains important for Australia, with many residences, communities, mining and telecommunications sites requiring stand-alone power systems.

As PV penetration levels rise, maintaining high quality products and installation standards will become more challenging, while grid impacts will begin to signal the need for new grid management strategies.

Muriel Watt is Project Manager of IT Power (http://www.itpau.com.au/). Watt has worked in government energy agencies, private companies and universities on energy-related matters since 1980, with a strong focus on renewable energy research, development, technologies, deployment and policies.

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