Australia reduces solar rebate due to budget crunch

10 June 2009

Households in Australia are now required to apply for a new rebate under the Renewable Energy Target scheme after the Australian government abruptly decided to end the existing rebate on 30 June after it received 30,000 applications for it last month.

The government's decision to end the rebate three weeks prior to the date announced previously has left solar retailers scrambling to rush thousands of rebate applications yesterday after getting only an eight-hour notice that the scheme would be withdrawn prematurely.

Environment minister Peter Garrett said the sudden move had been necessitated due to the original estimate of $150 million ballooning to $750 million a year due to the scheme gaining unexpected popularity.

Garrett had earmarked an additional $271 million in the May budget to fund the rebate scheme until 30 June, but it is understood that allocation had been almost entirely consumed by the receipt of almost 30,000 applications in the past month.

Greg Hunt, opposition environment spokesman said the rebate scheme had become a victim of the $58-billion budget deficit. He said the government had again sent the solar industry into chaos with the ill-thought-out move.

A new scheme that would offer far less generous solar credits would come into effect 10 June. According to retailers, households in Victoria would get about $4,000 for a one-kilowatt system which would be cut over time to about $800. A one-kilowatt system typically is available for about $12,500.