Solar paybacks improve by 50% as Victorian electricity prices double
Jul 07, 2017
Victorian business customers have experienced electricity price increases in recent months up to a doubling of the per kWh energy charges. Customers with electricity contracts ending during 2017 face new contract prices up to twice their previous rates. Enhar has undertaken solar payback analysis for customers such as Local Councils and found solar paybacks reducing from around 15 years to around 8 years in some cases, simply due to the step change in electricity prices in Victoria. Wholesale electricity price increases are attributed to the increased reliance on gas after the closure of Hazelwood coal power station, coinciding with major gas price increases. The lack of coherent federal energy and climate policy has also been blamed for increased energy prices. The medium term outlook for electricity prices is not so dramatic, however; the expectation is that if new electricity retail contracts are negotiated in 2018, wholesale rates will have reduced slightly from the current historic highs. For our clients already engaged in energy efficiency and renewable generation, the business case for investment has just improved dramatically. Others have elevated renewable energy generation and efficiency onto the agenda for the first time, seeking to reduce exposure to grid electricity costs. Manufacturing businesses are hard hit by increased energy prices. With smart usage of technology and supportive funding arrangements, it is likely that significant uptake of new renewable generation such as rooftop solar PV, switch from gas to electricity, and energy efficiency could make the difference for many companies enabling them to stay in business. Contact us to find out how we can assist your businesses to reduce energy costs through smart adoption of renewable energy.