Victorian premium feed in tariff ends on 1st November 2024 - what are my options?

Navigating the end of Victorian Premium Feed-in Tariff:  What You Need to Know

As the calendar inches closer to November 1^st this year, Victorian households enjoying the 66c Premium Feed-in Tariff (PFIT) find themselves at a crossroads.

The PFIT ran between 2009 and 2011 and had the objective of kick-starting renewable energy adoption in Victoria.  For early adopters, “solar pioneers” the tariff has been very advantageous with many having low bills, no bills or even credits.

However, all good things come to an end, and in the case of the PFIT, that means the November 1^st this year.

Understanding the implications is crucial for those affected.

Understanding the Victorian PFIT

The Victorian PFIT has been a boon for early adopters.  Under the scheme, households were paid a generous rate of 66c per kWh for electricity they fed back into the grid.  The objectives of the PFIT were to encourage solar panel installations.

Who Does it Affect?

The end of the PFIT affects a significant number of households across Victoria.  For these individuals, the impending expiration necessitates a re-evaluation of their energy strategies and home budget for energy bills.

Impact on Household Bills

The end of the PFIT will see feed-in tariffs for participants drop from 66c to the default flat rate of 3.3c per kWh.  This rate will vary from retailer to retailer and while it is tempting to sign up for the highest feed in tariff you can find, it is more important to look at the overall rates including supply charges and peak and off-peak rates.  Do not be seduced by the feed in tariff.

Accordingly, households will see significant increases in their electricity bills, prompting the need for proactive measures to mitigate costs.

Exploring Available Options

Considering the impending changes, households have several options to optimize their energy usage and minimize expenses:

Time shift loads:  The PFIT saw many households minimise daytime energy consumption to export as much as possible.  From November, the opposite strategy will make sense.  By adjusting the timing of energy-intensive activities to coincide with periods of maximum solar generation, households can maximise self-consumption.

1. Increase solar system size:  Many systems installed in the PFIT period (2009-2100) were small by today’s standards and won’t meet the needs of household daytime loads during the day.  Expanding the capacity of existing solar installations allows homeowners to generate more electricity for self-consumption and potentially offset the reduction in feed-in tariff rates.  In conjunction with time shifting and battery storage, this can make a material difference.  Generous rebates are available for solar system upgrades, making this strategy more cost effective that you may first think.
    
2. Battery Storage:  Investing in battery storage systems enables households to store excess solar energy for later use, enhancing energy self-sufficiency and reducing reliance on grid electricity during periods of low solar generation or high demand.  As a bonus, a properly designed and installed battery can provide coverage during a black out.  Many are concerned about future grid stability.  Batteries allow you to take control of your power and achieve energy independence.
    
3. Heat Pumps:  Heat pump hot water and heating and cooling are energy-efficient alternatives to traditional methods.  Sustainability Victoria estimates replacing gas with electric alternatives would save the average Victorian home $1250 without solar PV.

Should I Expand or Replace my Solar?

If you’re on the PFIT, your solar will be 13-15 years old.  Manufacturer and installer warranties will have ended (assuming they are still around).  Installation standards have evolved considerably.  Solar panels are much more efficient and better made.  Today’s systems are much smarter with internet-based monitoring of production and consumption and battery compatibility.

The average sized PFIT system was only 1.5 kW as compared with the average in 2024 of 9kW and growing.  The size difference is being driven by electrification, battery storage and EVs.

Adding panels to an existing system isn’t an option because today’ panels are not compatible with old systems.  Further, adding panels means the existing system has to be brought up to current standards which isn’t financially worthwhile.

On the other hand, a new system will:

• Be in-line with the latest technology
• Be better matched to your current energy needs
• Come with new and longer warranties
• Be designed to accommodate future energy needs such as being “battery ready” or able to accommodate other products such as electric vehicles or induction stovetops which you may want to purchase later.

Who Do I Trust?

Over 700 solar companies have gone bust since the PFIT era.  Sunergy is the only local company that has stood the test of time being in continuous operation since 2010.  It’s not by accident that we are still here.  The success and longevity comes from:

• Installing products from quality long term manufacturers with a track record of backing their warranties.  Good solar isn’t cheap.  Cheap solar isn’t good.
• In-house accredited design and install team of licensed electricians and support staff.

Conclusion

As the Victorian PFIT draws to a close, householders have the opportunity to seize control and achieve genuine energy independence.  Or face a shock increase in their electricity bills. 

How can Sunergy help?

We are the longest operating solar installer in Bendigo being established in 2010.  We can offer the following:

• Free phone or face-to-face consultation to discuss your options
• Site inspection and system health and safety check
• New system special pricing - 6.6kW with consumption monitoring from $3490.  13.2kW from $6800