Pensions, feed in tariffs and solar power

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Pensions, feed in tariffs and solar power

Postby MichaelB » Tue Apr 27, 2010 12:27 pm

There's been a lot of reaction to a recent Sydney Morning Herald story saying that pensioners taking advantage of feed in tariff arrangements could find their pensions cut as a result. The SMH article omitted some critical information at the time of publishing. To help clarify the situation, we've published a response:

http://www.energymatters.com.au/index.p ... cle_id=857
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Re: Pensions, feed in tariffs and solar power

Postby GTOwner » Wed Apr 28, 2010 12:39 pm

I assume that the assessment on income will be based on the difference between the generated and used electricity. If the generated power does not exceed the consumed power for the billing period (Usually 3 months) there will be no credit available. Hence I assume no income for the period needs to be declared.

However, another interpretation is that any generated power shall be considered income. This would create a complex calculation, especially in Victoria which has two rates for owner used power and the premium rate when power is fed into the grid.
If the income is assessed on an annual basis over and above the consumed energy costs (Ie credits received by the electricity provider) then this would be less of a problem.

I am not familiar with the bi-directional meter but I assume it can register exactly how much power is generated for the day, month and year. Social security may what this figure to be declared with a generation rate received.
Not sure which way it will go?
I assume no one has tested this?
My pensioner parants are about to have a solar system of 2kW installed and it should cancel out there bill. But they are concerned the electrical generation will affect there pension.
:roll:
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Re: Pensions, feed in tariffs and solar power

Postby MichaelB » Wed Apr 28, 2010 12:53 pm

Hi GTOwner, in regard to pensions, our understanding is that it will be down to any *income* generated by the system - i.e. a check/payment made to the owner of the system rather than based on credit on a bill; but Energy Matters is seeking clarification on this and raising our concerns about pension and general tax related issues at the next CEC conference next week.

Your parents should consult Centrelink - wish I had a specific contact point to give you because I fear that when people do make enquiries, they'll wind up speaking to an C'link employee who isn't sure either. I don't think there's specific FiT guidelines in place as yet at Centrelink; the general income test criteria is being applied and it's a little like trying to cram a square peg into a round hole.
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Re: Pensions, feed in tariffs and solar power

Postby gully » Wed Apr 28, 2010 3:11 pm

I didn't think most pensioners viewed this as a money-generating exercise, more a money-saving exercise (low/no power bills). I think anyone who views this to make money is taking a slight risk. A year ago the PFIT wasn't available, and reputable solar companies were selling systems on the basis of a 1:1 kWh return. I dare say there are people out there swearing it's the next 'pensioner income loophole' - i've heard some solar salesmen saying "you'd better sign up soon, else the PFIT scheme will be closed soon". Wherever there is money there will be scare tactics and pressure.
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Re: Pensions, feed in tariffs and solar power

Postby GTOwner » Wed Apr 28, 2010 4:08 pm

MichaelB.
I appreciate your advise and I do agree that it's the payment to the property owner that is likely to be used for income accessment. If that is the case then my parants should not be too concerned as there electrical consumption will probably equal or be less that the generated grid feed quantity.
It will be interested to see how this topic plays out at the CEC conference.

I assume from your letter (and I agree) non pension households should not have to worry about declaring income from the grid feed, given the intention for the householder in not to run a buisness generating electricity but one of just helping the environmnt and reducing his electrical bills.
I assume this also needs to be clarified?

Gully
I agree with you most if not all pensioners do not see this as a money-generating exercise. My parants just what to have lower power bill costs.
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Pensions, feed in tariffs and solar power

Postby Tracker » Wed Apr 28, 2010 5:18 pm

.
I assume that the assessment on income will be based on the difference between the generated and used electricity. If the generated power does not exceed the consumed power for the billing period (Usually 3 months) there will be no credit available. Hence I assume no income for the period needs to be declared.


From an interpretation that I heard as having originated from Jenny Macklin, I got the impression that the INCOME will be deemed to be the Export-Dollars, GROSS payment. :(

That would be consistent in the application of a Greed-Grab of pensioner's money.

If they assessed the income as the actual Money-In-Hand, then that implies that Energy Usage can be claimed as an expense against income.. .. Sorry guys, I can't see them letting that one get away?

Pensioner 1 - No solar - Pays their Electricity bill and claims no benefits. Very Boring
Pensioner 2 - Has PV Solar - Generates the equivalent in $ as they use -hence NO bill to pay
Pensioner 3 - Has PV Solar - and generates twice as much in $ as they use
Pensioner 4 - Has NET PV Solar - and generates a few dollars a week in export power

Who can claim their Electricity Usage as a deduction - None - as it would be unfair
Who has to declare for the Power the Produce - Both 2 and 3 and 4 will pay for every watt they produce.
Who is the best off? I would speculate - (4), depending on their other incomes needing declaration.

Yes - it's speculation, but that is the ONLY rational way that it can work.
How can 2 and 3 and 4 fairly reduce their INCOME, by claiming their electricity bill as an expense
This (I think) confirms the comments of Jenny Macklin... .. :roll:

It will be interested to see how this topic plays out at the CEC conference.


Respectfully - why would you leave it to a CEC meeting.. Do you really think that the Government cares anything about the CEC.
C.Rudd has shelved the ETS for three years. That is how sincere he is about the environment.
If anyone holds any concerns, then you should be taking it up with your local members, and now..
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Re: Pensions, feed in tariffs and solar power

Postby MichaelB » Mon May 17, 2010 1:35 pm

As mentioned in another thread, Centrelink has announced feed in tariffs will *not* be included in pension income tests .

http://www.energymatters.com.au/index.p ... cle_id=886

.. still awaiting clarification on the situation re: other Centrelink clients.
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Re: Pensions, feed in tariffs and solar power

Postby GTOwner » Tue May 18, 2010 7:20 pm

Michael B
Appreciate the notice.
My parents are having a 2kW system installed mainly due to the pool pump electrical costs.
I will tell them the centrelink news tomorrow and this will settle there nerves.
Thanks
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Re: Pensions, feed in tariffs and solar power

Postby bpratt » Wed May 19, 2010 9:33 am

GTOwner wrote:Michael B
Appreciate the notice.
My parents are having a 2kW system installed mainly due to the pool pump electrical costs.
I will tell them the centrelink news tomorrow and this will settle there nerves.
Thanks


I vaguely remember seeing some replacement pool pumps that can use up to 90% less electricity, so perhaps if they need to replace the pool pump down the track, they probably should start looking at what's available before they need to run out and buy just another standard pool pump.
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Re: Pensions, feed in tariffs and solar power

Postby MichaelB » Wed May 19, 2010 11:34 am

Yet another update on the situation:

solar-wind-rebates/topic1070-50.html#p7763

I'll lock this topic now so we just have the one thread going.
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