September 1, 2017

Victorian Regional Energy Target: Taxpayers to subsidise wind farms

Peter Hunt | The Weekly Times | September 1, 2017 |

Taxpayers, not consumers, will bear the burden of the Victorian Government’s drive to subsidise a multi-billion dollar investment in renewable energy.

Energy Minister Lily D’Ambrosio has told The Weekly Times the Victorian Renewable Energy Target would not be funded through customers’ electricity bills, with her office stating the Government would now be tapping into the state Budget to subsidise wind and solar farms.

While Minister D’Ambrosio had previously stated the scheme would cost the average household $26 a year (50 cents a week), her spokesman said the scheme would now be funded from the Budget.

In developing the scheme the Government had originally proposed the “scheme costs will be recovered via either electricity distribution businesses, the state’s privatised transmission business, or electricity retailers, and ultimately passed through to customers’ bills. To enable this, a regulatory obligation will be levied on one of the above parties”.

However Ms D’Ambrosio’s office said the Government had now decided to fund the scheme from the Budget, but would not be revealing the amount.

Last week Premier Daniel Andrews announced legislation would be introduced into the Parliament to set ambitious new renewable energy targets for Victoria of 25 per cent by 2020 and 40 per cent by 2025.

Australian Energy Council wholesale policy manager Duncan Mackinnon said consumers would still have to fund the cost of boosting the capacity of northwest Victoria’s transmission network to hook wind farms to the grid.

Last year the Australian Energy Market Commission calculated the average Victorian household, consuming 4026 kilowatt hours of electricity each year, would pay the following “environmental” charges in 2017-18:

$29 to fund the Federal Government’s large-scale renewable energy target (LRET), which subsidises wind and solar farms.

$15 to fund the small-scale renewable energy scheme (SRES), which mainly subsidises rooftop solar panels and solar water heaters.

$20 to fund the feed-in tariff scheme that subsidises the price households get for power they feed back into the grid from solar panels.

$10 to fund the Victorian Energy Efficiency Target Scheme, which subsidises companies that install energy efficient lighting and other technologies in homes and businesses.

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