Regional Queensland solar feed-in tariff rates set at 6.3¢/kWh-8.7¢/kWh

Households in Queensland regional areas will receive a feed in tariff of between 6.3c/kWh and 8.7c/kWh for electricity exported back into the grid.

The price has been announced by Queensland Competition Authority, which has decided to set a minimum tariff for households in regional Queensland because of retail lack of competition in the state.

Households in the heavily populated south-east corner of the state, where there is retail competition, will not be paid any minimum tariff and will need to negotiate with their provider.

The QCA estimated that the value of the tariff should be 8.784c/kWh, less than one third of the retail rate. But it said this should reduce to 6.321c/kWh if the carbon price is removed. That’s because wholesale electricity prices are expected to fall if the carbon price is repealed.

QCA argues that any tariff should only represent the estimated wholesale price of electricity, plus ancillary fees and the value of transmission losses. It says all other costs are unavoidable.

The solar industry disagrees, noting that such estimates include no calculation of the potential benefits of rooftop solar, such as reducing peaks and avoiding or delaying infrastructure upgrades.

The QCA approach is different to that of Horizon Power in Western Australia, which has recommended tariffs of up to 50c/kWh in some towns in remote and fringe of grid areas because of the benefits that solar can bring. It has recently tendered for large battery storage systems to reduce the dependence of some towns on the grid.