Solar customers pay around 30% less for power: ACCC report

An inquiry into the electricity market by the consumer watchdog has confirmed that Aussies with rooftop solar pay less for power than their non-solar neighbours.

The Australian Competition and Consumer Commission (ACCC) report found that solar customers saved up to 31 per cent on their energy bills in 2020.

The Inquiry into the National Electricity Market report said households with solar paid 7.9 cents per kilowatt hour (c/kWh) less for energy than homes without solar – a 29 per cent reduction. While, small business customers with solar paid 31 per cent less than businesses without solar in 2020 – a 10.8c/kWh difference.

 

Residential energy usage solar customers vs non-solar customers

Unsurprisingly, residential solar customers’ power usage surged by nine per cent during the COVID-19 pandemic, while small businesses with solar decreased by two per cent. This was largely due to Aussies spending more time at home consuming electricity, while many companies reduced onsite business operations.

The ACCC report highlighted that feed-in tariffs offered by energy retailers to solar customers were the primary driver of these savings in 2020, with residential customers earning more than $300 a year in credits.

“Residential and small business customers with solar panels paid much lower rates than non-solar customers because they earn feed-in tariff payments, or rebates, for exporting electricity generated by their solar panels to the grid,” the report said.

Feed-in tariffs (FiTs) provide solar customers with monetary credits per kWh of leftover energy they export back to the grid, which can be used to offset their own energy charges. These credits generally range from 5c/kWh to 12c/kWh, depending on location and plan, but some feed-in tariffs are much higher, exceeding 15c/kWh. These negotiated FiT rates are usually set by electricity retailers, thus the variance in tariff size, however some states, such as Victoria, have a set minimum feed-in tariff for customers on single-rate tariffs.

The ACCC noted that feed-in tariffs saved households with solar around $94 more than non-solar customers on the median quarterly bill in 2020, despite solar customers using more energy from the grid.

With the benefits of rooftop solar clearly displayed in the watchdog’s report, Aussies should be encouraged to look into their energy costs and see where they could pocket some savings, Canstar Blue’s Energy Editor, Jared Mullane, said.

“These recent findings from the ACCC highlight just how much solar customers stand to save over the course of a year, even with their household electricity consumption surging, which is why bill-payers should take special notice of the rates they are paying, regardless of whether they have solar panels or not,” he said.

Mr Mullane reminded consumers, though, that the highest feed-in tariffs don’t always translate to the biggest savings.

“While solar customers will naturally be drawn to a higher feed-in tariff rate, they need to be conscious of the base rates they are charged for using power and being connected to the grid,” he explained. “Usage and supply charges will generally dictate what Aussies pay for electricity, with feed-in tariffs often providing solar customers savings on their bills for feeding excess power back into the network.

“That’s why it’s so important for solar customers to find an energy plan with a reasonable feed-in tariff, as well as low base rates, particularly with so many working from home or bunkering down due to the latest coronavirus restrictions rocking the nation. Don’t forget to always check the fine print before signing up to a plan and don’t be afraid to ask your provider questions if you’re unsure about anything.”

Compare Solar Plans

Here are some of the cheapest solar-specific deals from the retailers on our database. These costs are based on the Ausgrid network in Sydney but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. Annual price estimates assume general energy usage of 3900kWh/year for a residential customer on a single rate tariff. Price estimates exclude solar feed-in tariff credits. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Here are some of the cheapest solar-specific deals from the retailers on our database. These costs are based on the Citipower network in Melbourne but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. Annual price estimates assume general energy usage of 4000kWh/year for a residential customer on a single rate tariff. Price estimates exclude solar feed-in tariff credits. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Here are some of the cheapest solar-specific deals from the retailers on our database. These costs are based on the Energex network in Brisbane but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. Annual price estimates assume general energy usage of 4600kWh/year for a residential customer on a single rate tariff. Price estimates exclude solar feed-in tariff credits. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Here are some of the cheapest solar-specific deals from the retailers on our database. These costs are based on SA Power network in Adelaide but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. Annual price estimates assume general energy usage of 4000kWh/year for a residential customer on a single rate tariff. Price estimates exclude solar feed-in tariff credits. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Image credit: Kathie Nichols/Shutterstock.com, ACCC

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