Incentives, LOANS AND OTHER CONSIDERATIONS
There are no central government incentives to assist consumers or businesses in New Zealand to implement solar or other onsite renewable generation technologies.With the dramatic reduction in solar system pricing since 2010, such incentives are now not required or sought as they were in previous years.
Therefore it is also unlikely that any other incentive type like capital grants, feed in tariffs paid over retail rates, renewable energy payments will come into play. It is also unlikely that other alternatives will be considered by government like tax breaks or interest free loans.
To add to this:
- Past and current political environments maintain that New Zealand's centralised renewable energy generation portfolio (large scale hydro, geothermal and wind) constitutes circa 68% of total generation so the drivers to incentivise other forms of renewable generation do not exist in New Zealand as they do in many other countries who utilise non-renewable sources - nuclear, oil, coal generation plants
- Implementing incentives like feed in tariff's means consumers buying power off the grid, would pay a higher price for their power, to pay for the incentive, which is an unfair position for other consumers in the view of successive governments and policy makers
- SEANZ supports this position, as the lesson learnt from other countries is if a governement can give you an incentive, the next govenement can take it away potentially leaving investors in the lurch
- However. SEANZ has lobbied governments on the bigger picture to assist investment in the solar space as there exists a strong business case with the creation of employment, industry development, incremental increase in tax and GST take, contribution to GDP, the flow on effect into the local economy, greater energy eficiency resulting from generating your own power, technology and intellectual property export, as well as the potential to be the first country to move towards 100% generation from renewable sources
- Investment in solar in 2013 is about return on investment NOT payback period. Check with a SEANZ member
The Green Party in Ocober 2013 launched proposals that would assist consumers with solar investment based on defining a "fair price" being paid for exported power for a contracted period of 10 years. This is defined as a "Power Puchase Agreement" (PPA) between a retailer and micro-generators and would provide surety for the investor in solar (and other technolgies) with a guaranteed pay back, in the same way that large scale generators operate as they have PPA's in play to guarantee investment.
Several local councils like Nelson City Council have shown leadership in this space. Nelson are working on a scheme to allow their rate payers to include solar installation capital costs to be factored into and paid off through their rates. Wellington City Council have launched their "Smart Energy Capital City" project as a pilot scheme by installing ans subsidising solar systems in Wellington Schools
Both Nelson and Hamilton City Councils provide a specified minimum turnaround service for applications to install solar technology. They also waive any applicable fees for application for installation of solar.
Other local councils are working on a committment called the “Solar Promise” program to ensure they deliver a similar service.
Kiwibank in November 2012 officially launched their Sustainable Energy Loan Program - a first in New Zealand. Designed to assist consumers, install and implement their own system, the program uses SEANZ installer/system integrator members only, who can can analyse profiles and needs, design, supply, install and commission systems to meet consumers requirements with no fuss to ensure a hassle free process. For further information please contact us
Westpac in collaboration with Whatpowercrisis and Meridian launched their solar shed offering for the farming community.
Other financial institutions are planning to offer sustainable generation technolgy based loans.
Other financial considerations and FAQ's...
- How much does investment in your own generation asset/system increase the capital value of your property?
- Can I realise this value if I sell the property?
- Can I get grid connected and sell the electricity or the excess I generate back to a retailer? If so what do I get paid? And for how long? Will this provide me with confidence to implement a system? How does it impact the financials and numbers?
- What are the other reasons government wont provide mechanisms to assist uptake of solar and DG? Will this change under another political party or coalition with MMP, which means I may wait and see until after the next election?
- Can I play in the wholesale market, generate power and sell it to the grid, buy it at wholesale and then sell it at retail to consumers? If not, why not?
- What happens to the electricity system in New Zealand when distributed generators hit critical mass? What is the crticial mass number?