If you’re in Melbourne and you want to read about global warming and how man is allegedly trashing the planet, then you need to read The Age -- which, like the BBC, never saw a scare story about global warming it didn’t like.
Readers of The Age yesterday morning however would have choked on their muesli when they turned to page 6.
If there’s any place in the world that could make a success of solar, you would think that place would be the vast sunburnt land of Australia. What the story revealed however is that “the cost of installing and maintaining more than 1 million household solar power systems has outweighed their benefit by more than $9 billion.”
That is not a typo.
And by the time generous federal and state government subsidies run out, households without solar will have subsidised those that have made the switch to the tune of $14 billion.
That is not an insignificant number.
The Grattan Institute report, to be published Monday, says government incentives and rebates that have encouraged the uptake of household solar have "created a policy mess that should never be repeated" …
The report calculates that the capital cost of installing and maintaining household solar systems since 2009 has been $18 billion, while their benefit in terms of greenhouse gas abatement and reduced conventional electricity generation has been $9 billion….
In other words, it’s cost $18 billion to generate $9 billion.
The report finds that households that have installed rooftop solar have still benefited greatly in financial terms "because the incentives offered by state and federal governments have made an uneconomic decision financially viable." …
Households with solar have also benefited from the fixed structure of electricity tariffs the report says, which has resulted in homes that don't have solar power effectively subsidising network use by those that do.
As I’ve said many time, so-called “renewable” energy may be defined as energy that is not economically sustainable without subsidies, grants or tax breaks. In other words, it absorbs more value than it produces. It’s a fantasy. As Alex Epstein says, “It’s not really renewable, and it’s not really energy.”
[Pic and caption by Fairfax]