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2010
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
Renewable Energy Amendment (Feed-in-Tariff for Electricity) Bill 2010
EXPLANATORY MEMORANDUM
(Circulated by authority of Senator Milne)
Renewable Energy Amendment (Feed-in-Tariff for Electricity) Bill 2010
Explanatory Memorandum
This bill was introduced by the Australian Greens in the 42nd Parliament.
The following explanatory memorandum reflects the debate at the time of the
bill's original introduction.
Background:
The purpose of the Renewable Energy Amendment (Feed-in-Tariff for
Electricity) Bill 2010
is to amend the Renewable Energy (Electricity) Act 2000 to establish a
national feed-in tariff (FiT) scheme. The objective of the scheme is to
provide greater financial support for the commercialisation of a broad
range of prospective renewable energy technologies, particularly those that
are generally unsupported by the mandatory renewable energy target scheme.
In summary the scheme is intended to operate as follows:
Feed-in-Tariff Rates
i. It is the responsibility of the Minister for Climate Change to set a
feed-in-tariff (FiT) rate for any of the sources of renewable energy
technology listed in section 17 of the Act, each year.
ii. The Minister's objective is to support the economic viability of
electricity generation from a range of prospective renewable energy
technologies. To achieve this, the Minister may vary FiT rates
according to the type and location of qualifying generators.
iii. The owner of a 'qualifying generator' will receive a constant FiT for
20 years, set at the time that they register with the scheme, on all of
the electricity that they produce (not just the component which is
exported to the grid). Only generators installed after the commencement
of the scheme and which forgo participation in the mandatory renewable
energy scheme can be a 'qualifying generator'.
iv. The Minister must review the FiT rate applying to each renewable energy
generator type each year - with adjusted rates applying to new
installations. In order to provide a degree of certainty to
manufactures and suppliers of renewable energy products, the Minister
may increase the FiT rate, but can only decrease the rate it after a
period of 5 years from the date that the rate was initially set, and
then by a maximum of 10% per year. An exception to this rule could
occur if the Minister elects to set a target level of installed
renewable energy capacity (for any particular technology), and that
target is achieved, beyond which point the Minister may reduce the
tariff if such a course of action is deemed desirable.
Feed-In-Tariff Levy
v. The Minister must set a FiT levy rate per MWh of electric energy
acquisition from the electricity grid, to fund the FiT rate scheme. The
FiT levy is to be imposed by a proposed Renewable Energy (Electricity)
Feed-in-Tariff Levy Act 2008. The FiT levy rate must be sufficient to
cover the estimated cost of payments under the feed-in-tariff rate
scheme.
vi. The FiT levy is payable by all electricity retailers and direct
customers of electric energy from the grid, calculated by reference to
their annual energy acquisition statements lodged under section 44.
Note that the annual energy acquisition statement is also used to
calculate the renewable energy shortfall charge of an electricity
retailer or a direct customer.
Feed-In-Tariff Payments
vii. An annual return by the owner of a qualifying generator must be lodged
with the Regulator within 30 days of each anniversary of the
registration of the qualifying generator. The Regulator must pay the
feed-in-tariff rate to the owner of a qualifying generator within 30
days of receiving from the owner an annual return in the prescribed
form indicating the metered energy produced by the qualifying
generator.
Feed-In-Tariff Register
viii. The Regulator must establish a Register which records:
a. details of all qualifying generators, including the name and
address of the owner of the generator, the date of registration
of the generator and the type of generator (that is, the
eligible renewable energy source used by the generator); and
b. the total amount of electricity produced by each qualifying
generator; and
c. the feed-in-tariff rate to be paid to the owner of a registered
qualifying generator and the period for which the feed-in-tariff
rate will be paid.
Reporting
ix. The Minister must ensure that an independent report on the operation of
the FiT scheme is prepared and tabled each year. The report must
include details of total renewable energy produced and total payments
made under the feed-in-tariff rate scheme, and the total receipts from
the feed-in tariff levy.
x. The Minister must provide statements explaining how the feed-in-tariff
rates and levy rates are calculated and must table those statements in
both Houses of Parliament each year.