19 March 2012
Feed-in Tariff Arrangements and Barriers to Distributed Generation Inquiry
Victorian Competition and Efficiency Commission
GPO Box 4379
MELBOURNE VIC 3001
feedintariff@vcec.vic.gov.au
RE:Feed-in Tariff Arrangements and Barriers to Distributed Generation Inquiry
Dear Commissioner,
I refer to the Feed-in Tariff Issues Paper, released February 2012, inviting the public to comment
on the current issues with Feed-in Tariffs in Victoria.
http://www.vcec.vic.gov.au/CA256EAF001C7B21/WebObj/VCECFeedinTariffIssuesPaperPDF/$File/VCEC%20Feed-in%20Tariff%20Issues%20Paper%20PDF.pdf
Mildura Development Corporation (MDC) is the peak body for business development for the
Mildura Region. Renewable energy and solar in particular are a major component of the business
developments we see for this area.
MDC has worked closely with the solar industry, residents and local business to encourage solar
uptake from the very smallest systems to the largest. Below are the issues in the solar industry
that we see could be positive outcomes for the industry sector with change to government policy.
Small Scale Solar PV
 As the energy being used by a building is also being generated on it, a Net FiT is the most
sensible solution for the billing of this energy.

Feed in tariffs are not being promoted by the electricity retailers. Information is difficult and
often non existent for customers to make an informed decision about which retailer to sign
up with. Different tariff rates are not advertised for customers with small scale solar. Most
retailers do not have an easy to understand brochure on how electricity generation is billed.

Yourchoice.vic.gov.au website is difficult to navigate for finding solar pricing comparisons.
No information is available to estimate expected bills. No ability is given to compare bills for
different market offers. Explanations of the solar offers are not available. There is no
information about what the current Transitional Feed-in tariff rates on offer for each retailer
is.
101 Lime Avenue Mildura Victoria 3500
PO Box 4146 Mildura Victoria 3502
Website: www.milduraregion.com.au
Telephone: 03 5022 0722
Facsimile: 03 5022 0251
Email: info@milduraregion.com.au

Length of policy commitment is not consistent with the current technologies. With inverters
now being provided with an optional 25 year warranty and solar panels with 25 year
performance guarantees, some are thinking about a 40 year warranty. This suggests the
market is looking at a long term investment, yet feed in tariffs are being reviewed on a 3-7
year basis without any long term strategy or guarantee. This stifles the industry and does
not allow it to develop into a profession as is required. STCs can now be calculated over a
longer period than 15 years, perhaps on a sliding scale based on manufacturer
guarantees/QA. Conversely an additional tariff could be included after the first 15 years of
life for the PV generator, should it be operating.

Rental and non residential properties are disadvantaged unnecessarily. Should government
policy promote distributed generation, a policy for the changing of rent in relation to the
costs involved in the installation of PV would encourage landlords to install PV.
Encouraging small businesses to install PV will reduce peak demand for business areas.
FiTs should be extended to small business to encourage PV uptake in such a way as to
enhance their bottom line within reasonable timeframes eg payback or return on
investment.

Relevance of Co and Tri Generation for residents. Residential technology is more than 5
years away from forming a cost effective residential solution. In the mean time a feed in
tariff for PV will allow residents to reduce their energy usage in the same order of
magnitude as businesses can for co and tri-generation.
Medium Scale Solar PV
MDC anticipates that the uptake of Medium Scale Solar PV as a means of trialling technology for
large scale deployment will increase as the industry matures. Medium scale projects should be
encouraged to provide a centre of excellence and research into large scale development
throughout the country. The implementation of a series of Medium Scale Solar PV installations will
also help to prove the technologies under different environmental conditions, contributing to
superior product development.
Transparency of distributor registration costs: Applicants are not aware of the reason or cost break
down of many fees, how they are applicable or to whom.
Ability to negotiate directly with distributor: Applicants are not allowed access to internal processes
to provide efficient and timely information, often negotiations with distributors are via a third party.
Length of policy commitment: With component warranties now beyond 20 years, Large Scale
Technology Certificates policy now has to take into account longer installation timeframes and
policy commitment now has to be flexible enough to see return on investment beyond 5 years
become viable.
Policy change for non standard business structure operated installations. This could open the way
to allowing community owned or not for profit organisations to viably operate solar farms. There
have been a number of organisation that would like to open a community solar farm for little
commercial benefit, however, as the scale is beyond the 100kW threshold for Small Scale Feed-in
Tariffs, the fees involved to become an electricity generator are unnecessarily prohibitive.
Large Scale Solar
Large scale consistent policy direction is required to develop any projects in the Mildura Region.
As stated above the solar PV policies need to be relatively consistent over a period of time close
to the length of time for the installation.
Consistent policy will attract large scale investment to the Mildura Region.
In direct response to the questions asked in the Feed-in Tariff Issues Paper, MDC offers the
following comments.
Suggested Definitions
Distributed renewable
 Renewables that are connected to the electrical distribution network without
need to directly and immediately transform the power to the electrical
transmission network
 Discussion. In areas where a high degree of electrical infrastructure is
required to be installed as a direct result of the installation of a distributed
generator, the location of the generator is not appropriately servicing the local
community as a distributed generator. This is independent of the size of the
generator and dependent on the size of the community.
Low emission generation
 A source of electrical generation that does not produce carbon during its
normal operation as an electrical generator.
Large Scale renewable
 A renewable generator that generates enough electricity that the NEM must
manage the constant, fluctuating or intermittent energy during its normal
operation as an electrical generator
Specific questions
What is the problem that feed-in tariffs are addressing?
 They are providing an efficient mechanism for residents to evaluate PV prior
to commitment to a sizable purchase
 Encouraging the uptake of PV within specified ranges
 Providing a simple billing tool for electricity retailers
 To encourage distributed generation within appropriate regions
What are the intended outcomes for FiTs?
 To encourage the uptake of renewables
 To provide a simple mechanism for electricity retailers to evaluate commercial
viability.
What are the most appropriate objectives for the feed-in tariffs?
 To encourage distributed generation within appropriate regions
Is a regulated feed –in tariff an efficient way to achieving these objectives?
 Feed in tariffs must have a long term policy direction.
 As we have seen in recent years and outlined above, the electricity retailers
are often not forthcoming about their obligations under the feed-in tariff
scheme. Should feed-in tariffs continue in any manner a regulation body
would be necessary to maintain public control.
Does the introduction of an emissions trading scheme remove the case for FiTs as an instrument
for reducing greenhouse gas emissions?
 ETS does not encourage the use of renewable generation in isolation. An
ETS encourages the use of reduced carbon by any means. Hence the FiT
would still have a place within an ETS environment.
What should the commission take into account when assessing feed in tariffs?
 Constantly changing policy reduces public investment to the point where we
see diminishing industry commitment
 Publically accountable regulations will drive public confidence up
 Researched and informed debate from all sides of this argument are
paramount.
 Other topics have been included as above.
Should you have any questions or wish to discuss any part of this submissions please do not
hesitate to contact me on 5022 0722
Kind regards,
Anne Mansell
Chief Executive Officer