Corporate Consulting

The Australians solar industry offers one of the few commercial growth industry opportunities available to the business sector and increasingly difficult economic climate which is exacerbated by an increasingly incompetent government. Inept government oversight, firstly in the insulation industry and secondly, in the solar industry, has resulted in extreme commercial manipulation at the sometimes tragic expense to the general homeowner. It has created a cowboy industry mentality with SMEs looking to make a quick buck without applying the necessary duty of care and responsibility.

Government rebates were used to kick-start and ignite Australian solar industry without the required specialised SWOT Analysis which would identify the current spate of problems which had been spawned by a terrible lack of government oversight. Now that the rebates have all but dried up we are starting to see the cowboys disappear as the solar industry starts to mature.

The Evolution of Solar

The Australian solar industry has evolved as a direct result of the global awareness raised by the effects of increased energy costs. As a result, the government introduced a series of financial rebates to induce public acceptance at a residential level. As is usually the case, the lack of government expertise has resulted in this emerging industry becoming unsustainable in its current form due to the connection in adequacies. Simply put, the current government subsidised grid-connect system is producing electricity during off-peak periods, causing a dramatic rethink in general harvest methodology.

Currently, only 10% of the available Australian market has taken up residential solar installations. The next wave of evolution will still result in solar panels being put on rooftops however we will see on the power being downloaded from the grid to battery storage banks during off-peak periods.

Electricity Network

The maintenance cost of the current ENERGEX and ERGON networks is prohibitive while the development of new infrastructure, such as power stations, runs into many billions of dollars.

The current government sponsored solar program has created a situation whereby residential solar harvesting is happening in predominantly nonpeak periods which is creating a series of unsustainable bell curves within Network energy suppliers.

Background

Prior to 9th July 2012 homeowners could apply for a Network agreement in Queensland which allowed them to sell their excess power back to the Electricity Grid and receive $0.44 cent per kilowatt (in the form of a feed-in tariff) through until 2028. At midnight on 9th July 2012 the government discontinued the $0.44 cent feed-in tariff and, as a result, no more Network agreements have been issued; unless applications were received prior to 9th July 2012.

Currently people with Network agreements with either ERGON or Energex (in Qld) receive up to $0.50 per kilowatt of power exported to the Grid; depending on which Supplier they use; and is made up of the $0.44 cent per kilowatt feed-in tariff PLUS any extra financial encouragement offered by Suppliers (eg; Origin Energy offer an extra $0.06 cents per kilowatt !).

These recipients achieve the best ROI by putting as much power to the Grid as possible and paying the relevant peak and off-peak rates for their day-to-day electricity consumption.

BUT, Network agreements were voided if the homeowner did not not have their Solar System installed and Grid connected by 30th June 2013 !

Those who failed to apply by 9th July 2012 missed out and only receive the minimum $0.08 per kilowatt; and conversely, they receive the best ROI result by using as much self-generated power as possible and selling as little to the Grid as possible.

The Effects of Government Pandering (to the ‘Greens’)

Government policy required the Electricity Network Suppliers

The power companies have been privatised with shareholders expecting to receive reasonable ROIs and the Act will potentially impede any reasonable increase back to normality.

The ongoing cost of Network infrastructure and maintenance programs already runs into the Billions of dollars per annum. Electricity Network Suppliers are looking to cost recover as much of the capital enforced expenditure is possible and in order to do that there have already been some extremely unpleasant measures introduced. For example:

Electricity Suppliers have already retaliated in several ways such as:

Pricing Increases the Base Rate of Electricity: (already one rise of 20% implemented)

• Feed-in Tariff – from $0.08cents per kW up now to $0.14 cents per kW (Origin) and $0.16 cents per kW (AGL)
• Peak – from $0.15.5 cents per kW up now to $0.23 cents per kW with another 25% increase about to take effect.
• Off Peak – from $0.08.43 cents per kW up now to $.15.5 cents per kW

‘Commercial / Industrial Demand Metering’: has been introduced for the commercial sector which identifies and calculates power requirements based on the highest point of use in a month for any instrument/machine/equipment which operates for less than 15 minutes once per month. (can go back 11 months after spike-arresting equip has been installed and charge the highest peak for that period for the ensuing 11 months)

‘Residential Time of Use’: charges (Tariff 12), have been introduced to the residential sector which will result in the peak timeslots of 6 AM to 10 AM and 4 PM to 8 PM being charged out at $.38 per kilowatt hour (plus) with the expectation of $0.50 cents per kilowatt hour within less than two years.

In addition to that, the cost of electricity is expected to double the next two years!!

The Problem

The industry has been inundated with the ‘solar cowboy businesses’ who have imported as much of the cheapest solar related product as possible; which has been sold at the highest price possible to the unsuspecting customer on the street. More often than not, misrepresentation, dubious sales techniques, a complete lack of Quality Assurance, the absence of quality advice, lousy products, non-existent warranties, a lack of customer support and …… a total absence of responsible business practice has been the order of the day.

The Solution (Post 30 June Market Rationalisation)

The industry underwent monumental changes after 30th June 2013 for a number of reasons, some of which need to include:

• Solar sales Cowboys disappeared almost overnight
• Government multiplication rebates discontinued
• Feed-in tariff were substantially reduced from 44 to 8 (Qld only)
• Dramatic increase in Power prices
• Economies of Scale demands additional energy solutions
• Chinese Solar companies going broke/warranties were voided
• CEC created a Register of panel importers / manufacturer / agents to guarantee warranties
• One now needs Govt. approval to import products

The Future

Renewable Energy sales will emanate from the following areas:

Residential

• Hybrid Systems
• Battery Storage Systems
• Stand Alone Systems
• Evacuated HWS
• Solar System Maintenance

Commercial

• Hybrid Systems
• Battery Storage Systems
• Energy Reduction
• Energy Management
• Solar System Maintenance

Government

• Federal Solar Incentives
• State Solar feed-in tariffs.
• Compliance Management

Evolving Technology

1. Hybrid Systems

2. Battery Storage Systems

3. Stand Alone Systems

4. Energy Reduction >> Monitoring >> Demand Response (DR)

5. Energy Management >> DR Controllers

6. Evacuated HWS

7. Solar Air-Conditioning

8. Micro-Inverters

9. Nano Technology

Renewable Energy Sales Opportunities

Residential

What this tells us is that the market place is confused. They have been bombarded with conflicting information/ education, misrepresentation, and amongst other things, a lack of suitable financial alternatives and questionable sales techniques.

The Residential landscape is more than ready for clarity, trust, good education and good personalised customer service, performed by a trusted local identity; someone that has earned the community’s trust and respect …… and that someone is the local electrician.

Emerging Technologies for the Residential Sector include:

• Solar System Maintenance
• Hybrid Systems
• Battery Storage Systems
• Micro-Inverters
• Evacuated HWS
• LED Lighting (Light Emitting Diodes)
• Solar Air-Conditioning
• Stand-Alone Systems
• Nano Technology

Commercial

The Commercial sector is “the sleeping giant” within the Renewable Energy Sector.

Investing in Energy Reduction is a long term capital expenditure (asset) for businesses wanting to add value to their commercial properties (and save on rising electricity costs). Organisations will have the ability to choose the level of electricity cost that they want to offset with renewable energy, so their systems can be scaled in accordance with need (and ROI).

A commercial solar energy system can help reduce a company’s energy costs by up to 50 per cent. The benefits of such a saving are enormous and can positively impact on the long term direction that a company is taking.

Renewable Energy solutions will differentiate a business from its competitors today and improve their positioning within the marketplace while improving stakeholder relations by attracting environmentally conscious customers and staff who believe in operating a sustainable business.

Traditionally, solar energy has only accounted for less than one percent of the energy consumed by Australian businesses. However, there is a very bright future ahead for solar energy associated and renewable energy related solutions in Australia.

Trained within the ReNu Energy Group (REG), our partnering electricians will be able to offer their business clients a site review and after gathering the necessary data, REG’s Technical Advisory Board will provide a specialised feasibility assessment which will contain all relevant information necessary for the client to make an informed decision regarding implementation options and ROI.

Innovative Technologies currently available to the commercial sector crying out for real effective energy solutions are:

• Hybrid Systems
• Energy Reduction / Monitoring
• Energy Management /Profile Controllers
• Battery Storage Systems
• Stand-Alone off-grid solutions
• Solar System Maintenance
• LED Related Products
• Tube Technology
• Hydrogen Turbines
• Nano Technology

Specialist Consultants may also provide organisational change management assistance, development of coaching skills, technology implementation, strategy development, or operational improvement services. Corporate consultants generally bring their own, proprietary methodologies or intellectual property to facilitate the identification of problems, and to serve as the basis for effective analysis and the introduction of business strategies to maximise operational efficiency.