Subsidies for domestic solar panel installation must be scrapped on social equity and taxation grounds, says Committee for Melbourne

Many households have taken advantage of state government subsidies for solar panels. But the policy is flawed according to an influential lobby group. Here’s why.

The Committee for Melbourne wants solar panel subsidies dumped.

Onshore gas exploration in Victoria must be reinstated but no more subsidies should be given for residential solar panels, a key business and community lobby group says.

The Committee for Melbourne wants the main parties to commit to the policies to ensure that the state has affordable and reliable energy supply.

Under its revised policy paper Melbourne Beyond 5 Million, the committee said the ban on non-frackable onshore gas exploration had damaged the state’s previously robust energy capacity.

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Gas exploration is a contentious issue in Victoria.

It said that Esso had been prepared to invest its own money to determine the quantity of gas available.

Committee CEO Martine Letts said that Victorian gas production from offshore basins supplying the state was expected to fall by 40 per cent to 2025, “while demand increases as our city and state continue to grow”.

“Victorian industry and homes rely on natural gas more than customers in any other state. The best way to keep prices down is for additional high quality onshore gas supply to be opened up,” she said.

The Committee for Melbourne wants solar panel subsidies dumped.

The paper said the incoming government should reconsider giving subsidies for domestic solar panels on system stability, social equity and taxation grounds.

Ms Letts said the subsidy cut electricity costs for higher-income households that could afford panels.

“However, it’s a significant cost to taxpayers who cannot afford them, and who therefore have to subsidise mainstream supply,” she said.

“Solar panels will pay for themselves quickly without subsidy”.

The policy would not affect existing subsidised panels.

Committee for Melbourne chief executive Martine Letts.

The paper said the new government should return Victoria to being a net energy exporter within the Australian energy market, “not the net energy importer which it has recently become”.

Among other energy initiatives it called on the government to discuss with companies the feasibility of extending the service lives of the modern and efficient power stations Loy Yang A and Loy Yang B.

The paper called for an Equitable Energy Future policy for Victoria.

“Electricity and gas prices continue to rise, and simply put, we are running out of gas,” it said.

The Committee for Melbourne is an apolitical group with more than 150 members comprising business, academic and community sectors.

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