Australia basks in 3 million rooftop solar milestone, but dark clouds loom

While conflicting messages come from state and federal politicians, Aussie householders are taking climate action into their own hands and installing rooftop solar PV at world-beating numbers. Recently, three homegrown renewable energy groups announced that Australia had passed the three million solar rooftop milestone, and what is more, have shown how PV people power can make Australia a global leader.

Speed of Light

The numbers behind Australian households’ embrace of rooftop solar are astounding. 41 rooftop solar systems are being installed every hour in Australia – or one solar panel every 44 seconds. And those figures are still climbing from 270,000 systems in 2020 to already reaching 369,000 in 2021. These installation rates make Australia the world-leader in residential PV. According to the International Energy Agency (IEA), the number of solar households in Australia, on a per-capita basis, puts it 22% ahead of its nearest rivals, Germany and Japan.

Source: Tristan Edis/Green Energy Markets

And what’s behind this Bradmanesque run rate? Well, like anything, it’s a combination of factors, but the efficiency of Australia’s solar installers and wider PV industry is a major driving force.

“Thanks to Australia’s highly-efficient solar workforce, Australia is one of the lowest-cost countries for a rooftop installation,” said Kane Thornton, CEO of the Clean Energy Council, Australia’s renewable-energy industry association. “Our abundant sunshine, large homes and high electricity prices combine to make paybacks in Australia shorter than in most other countries.”

Having three million solar homes and small businesses is also delivering on Australian carbon emissions reduction, along with setting the country up for the new, low-carbon economy of the future, added Ellen Roberts, the national director of community-based solar owners organisation, Solar Citizens.

“As we transition to a cleaner economy, having abundant cheap energy during the day is a valuable resource that we can use to power electric vehicles, charge up community batteries and underpin new onshore manufacturing industries,” continued Roberts.

“Because of the hard work of Australians, we’re in a good starting position to become a clean energy superpower that can export our sunshine to the world.”

While this is undoubtedly a good news story for the economy, climate change and the millions of Australian households who are also benefiting from cheaper electricity bills, there are some dark clouds on the horizon, and clouds are not solar-friendly.

Clouds Loom

The bad news is that certain developments could see solar installations on Australian homes become more difficult and expensive. The first such cloud relates to the dynamics within the global solar industry at present. As of 2021, something approaching 80% of solar panels are manufactured in China or by Chinese companies. While this in itself isn’t problematic, at the moment there just aren’t enough solar panels rolling off production lines to satisfy global demand.

When announcing a deal to supply modules with one of the biggest solar wholesalers this week, China’s LONGi Solar noted that “supply chain difficulties” have “impacted the availability of solar modules [panels] in Australia.” LONGi itself is a giant of the solar industry and, in the past, has driven up solar panel efficiency and transformed the industry. In addition to the well-publicised global supply chain crisis, a range of shortages from solar glass to the raw material used in modules, polysilicon, and a range of other components, mean that Chinese solar panel manufacturers are scrambling to keep up with supply.

Adding insult to injury there are currently electricity shortages in parts of China, as the national government cracks down on some polluting power stations. As a result, solar panel factories have not been able to run at full capacity.

The short of it is that the price of a solar panels around the world is back to 2019 levels. While increasing prices is nothing new in many industries, it is highly unusual in solar – as the last decade has seen prices dramatically decrease and solar systems, as a result, pay for themselves in electricity bill savings for Aussie homeowners in only a handful of years.

Developments in solar panel prices are difficult to predict, but there are few signs they will fall in the short-term. Polysilicon, the raw material that forms the basis of over 95% of panels produced each year, has increased dramatically in price throughout 2021 and industry analysts see no end to the polysilicon shortage until mid 2022.

The other possible dark cloud for Aussie households looking to install solar is local. In a sense, rooftop solar could become a victim of its own success. Of course, the problem is not too much solar, but rather, too much solar at the same time. Basically then, more electricity supply than there is demand. This is not something that the grid has had to handle in the past and it could result in limits being put on solar in particularly congested sections of the grid.

In July of this year, the new head of the body that runs Australia’s electricity network, AEMO, Daniel Westerman, said that his goal was to build a system that can cope 100% renewables at certain times of the day, because 100% renewables at certain times of day is being achieved far quicker than anticipated. However, this might see solar curtailment in the short-term. Curtailment, in this context, means that solar systems will have to be prevented from pushing electricity into the grid – essentially short-changing households that have invested in rooftop solar expecting to earn extra cash by feeding their extra solar into the grid.

Source: Tristan Edis/Green Energy Markets

In a worst-case scenario, the companies that operate electricity grids may even ask AEMO to prevent homeowners from installing solar in certain areas. In a first step, there already are limits on the size of the solar system that is allowed to be installed.

Silver Lining

However, there is a relatively simple win-win solution already available. “Batteries stand out as an easy quick fix,” wrote Green Energy Markets analyst Tristan Edis in 2020. “The battery will soak up the [solar electricity] generation that would otherwise be exported and then allow it to displace grid imports in the evening, when network companies and therefore also retailers will hike up prices.”

Put another way, the addition of a solar battery will allow for some of the power generated by the panels during the day to be used in the evening when demand is peaking and therefore grid prices at their highest. Multiply that double-saving of coin and emissions over thousands of homes and it will also give grid companies, and AEMO, the confidence to clear the way clear for Australia’s continuing passion for residential PV.

Australia’s greatest strides in decarbonising and the global energy transition has been made by everyday Aussie households – in the form of residential solar adoption. And the future doesn’t look much different, except that solar will be coupled with batteries so that Australia’s plentiful sunshine can last through even the darkest nights.

By Chris Williams










By ChrisWilliams | November 15th, 2021 | Categories: General Solar, Solar News

These costs are based on the SA Power network in Adelaide but prices may vary depending on your circumstances. This comparison assumes a general energy usage of 4000kWh/year for a residential customer on Energy Locals Time of Use Tariff – (TOU – Peak, Off-Peak & Solar Sponge).

The reference price is set by the Australian Energy Regulator (AER) for a financial year in relation to electricity supply to residential customers in the distribution region and is based on an assumed annual usage amount. Any difference between the reference price and the unconditional price of a plan is expressed as a percentage more or less than the reference price. The terms of any conditional discounts are shown, along with any further difference between the reference price and the discount applied if a condition is met, expressed as a percentage more or less than the reference price.