Meridian
cuts solar 'subsidy'
Further
shadows have been cast on the solar power industry after a second
major electricity supplier cut its buy-back rate for new customers.
6
November, 2014
Meridian
Energy will today announce it has cut its buy-back rate for customers
generating solar power to nearly a quarter of its existing rate,
following competitor Contact Energy's drop earlier in the week.
Users
of renewable energy - such as solar or wind - use the electricity to
power their homes or businesses, and can sell back any excess
electricity to their supplier, to be used on the national grid.
Meridian
Energy currently buys solar electricity at 25 cents a unit for the
first 5 kilowatt hours generated, and 10c after that.
But
today the rate for new customers has been cut to 7c/kWh during
summer, and 10c in winter.
General
manager external relations Guy Waipara said after Contact Energy
slashed its buy-rate by more than half, from 17c/kWh to 8c, Meridian
had been left with the most attractive rates in the market.
But
solar energy uptake was becoming more popular, which meant it was
increasingly important for Meridian to get its rates right to stop
encouraging "wrong, unsustainable, uneconomic things to go on".
"We're
paying a solar customer three to four times what the energy would
cost you to buy from the market, which all comes from say a wind
station or a hydro station or a geothermal plant.
"And
we really struggled to see the rationale for keeping rates at that
level of basically subsidy."
As
such, Meridian had dropped its solar buy-back rate to a rate which
reflected the cost of any form of electricity on the market.
The
summer rate would apply from October to April, and was cheaper to
reflect the fact electricity was generally cheaper at that time of
year.
Installations
of home solar power systems have nearly quadrupled since 2011.
At
the same time, the average price has dropped by about 36 per cent -
such that a typical system now costs about $10,000.
Meridian
Energy currently has about 2500 solar customers.
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