Page 3026 - Week 07 - Thursday, 30 June 2011
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who take advantage of that subsidy. If the government makes a law and says, “This is going to be the subsidy,” it is reasonable that people make decisions on the back of that. Consumers make the decision to take it up; businesses make the decision to go into business, employ people and market the product on the basis of the schemes that are in place. Whether we agree with those schemes or not, it is completely reasonable for businesses to operate in that way.
For the minister to suggest that that is part of the problem—it is a pretty foreseeable part of the problem if that is the case. It was always foreseeable that there would be people advertising their product, sometimes aggressively. When you have got a very high and overly generous scheme, of course they are going to market that and of course people are going to take it up. And that is, of course, what has happened, but that is unsustainable.
The government’s position is that our amendments will spark the end of medium generators in the scheme—that microgenerators will crowd out the market. The government has claimed that the industry will suddenly be flooded again, and that this eight megawatts will be subscribed by microgenerators within five months. That does not take into account the legislation that is before us or the changes that the Canberra Liberals are proposing.
Under the changes that we are talking about, the scheme will no longer be as generous. The federal government has announced a reduction of the renewable energy certificate solar credit multiplier from five to three, effective on 1 July. For a 1.5 kilowatt system, the reduction in the multiplier would increase the up-front cost of the instalment from approximately $3,650 to $6,843. That is a significant increase, of $3,193.
So there will be less of an up-front incentive, and under our amendments there will be a significant downgrade in the subsidy. That should operate to moderate demand. That certainly will operate to protect electricity consumers from paying too much. Our amendments will see electricity consumers paying less than if we did nothing. If we were to do nothing to this scheme and just let it go on as it is—if we were to vote against all this legislation today—consumers would pay more: over $600,000 more per annum. Today, through our amendments, we will be saving consumers over $600,000 a year compared to if we were to do nothing or if we were to take Mr Corbell’s approach. If we were to take Mr Corbell’s approach, everyone would be paying another $600,000 extra—next year and for all of the coming years—as a result of this scheme.
So it is important that we apply those fundamental principles. How can we lessen the benefit to electricity consumers? How can we honour contracts? And how can we cushion the industry? That is what we believe needs to happen now—that a bad scheme needs to be made a little bit better.
The oversubscription is extraordinary. It calls into question how this government has managed that. I foreshadow what we will be doing to improve this bill before the Assembly today. We are proposing amendments to the Greens’ bill that will take away the 1 September 2011 start date, so that those who have a valid contract prior to
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