Electricity retailers in Victoria have been given approval to virtually eliminate payments to solar households for excess power sold into the grid under a draft ruling that reflects the runaway success of a technology that is now at times creating technical difficulties and extra costs for the power system.

The proposal by Victoria’s Essential Services Commission would cut the minimum flat tariff that retailers such as AGL Energy and Origin Energy must pay solar customers for the electricity they export to the grid to just 0.04¢ per kilowatt-hour next financial year, down from 3.3¢ this year.