Modelling creation of Small-scale Technology Certificates
attractiveness of SGUs, and therefore SGU installation rates. Given these two interrelated effects, the level of the Solar Credits multiplier is critical to the projection. ACIL Tasman has assumed the Solar Credits multiplier policy settings set out in Table 2 in determining historical and future financial returns to PV systems. Table 2
Solar Credits Multiplier
Assumed Solar Credits multiplier 9 June 2009 to 30 June 2011
1 July 2011 to 30 June 2012
1 July 2012 to 30 June 2013
1 July 2013 onwards
5
3
2
1
The Commonwealth Government put in place transitional arrangements in relation to the reduction of the Solar Credits multiplier from five to three on 1 July 2011, such that some systems that were committed to be installed before 5 May 2011, but installed after 1 July 2011, would receive a multiplier of four rather than three. However, ACIL Tasman’s analysis for ORER in June 2011, which included a survey of PV system suppliers to assess their views of the operation of the transitional arrangements, indicated that very few if any installations that are eligible to receive a Solar Credits multiplier of four would occur after 1 January 2012. Accordingly, these arrangements will have a negligible effect on STC creation rates in 2012, although some installations occurring between July 2011 and December 2011 will create STCs under this transitional multiplier during 2012. For completeness, ACIL Tasman assumed that half of the installations occurring in July and August 2011 would receive the transitional Solar Credits multiplier of 4. Also of importance to analysing the financial value of the Solar Credits policy to SGUs are changes in historic REC prices (prior to 1 January 2011) and historic and future changes in STC prices (following 1 January 2011). REC prices for the period 2008 to 2010 are shown below in Figure 3. This captures the steady decline in the REC price towards the end of 2010 as high levels of solar PV installation tended to exacerbate the existing bank of certificates and depress price expectations.
Analysis of financial returns from SGUs
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