Insurance for your solar business future? A message to solar businesses.
12 Mar, 2014
Like you, I sometimes wonder about the value of insurance.
For me, I look at the value of what I want to insure and weigh it up against the cost of insurance and the risk of something happening.
Today I bought some insurance for my solar business for a measly $50 a month.
Because the future of the solar industry is at risk.
Almost every solar program in Australia is under threat or review and many have already been axed. I explained our current political position to a client yesterday by producing a simple infographic that describes the programs, policies and drivers we had, and what it looks like we could have by the end of this year. As you can see the cumulative impact of the current policy environment is that across the board, our market is rapidly being de-incentivised from installing solar.
Whilst the astronomical rise in electricity prices should never have happened (despite massive subsidies), artificially holding prices down for political gain is likely to distort the signals for consumers. Even worse, is the distortion of pricing by creating the perception of reduced energy charges and simply switching the revenue stream to fixed costs which prevents consumers from being able to save money with solar. The Carbon Price, CEFC, ARENA and RET are all under serious threat and we have already lost virtually every FIT in the country. The incredibly successful CTIP program which was the only business focused program we had is already gone and Direct Action looks like its dead before it even starts.
On top of this we have foreign exchange rates that have already increased prices locally and PV industry consolidation and cost increases both driving prices up since December last year. Add in the complete lack of will on utilities part to sign PPA’s for large-scale generation and really, the only thing left ( and even it could be a flash in the pan) is Solar Flagships.
You’ll also see I include Sentiment in the stack. This reflects the attitude of State and Federal Government, with a very small number of exceptions. By and large, all we hear from Government is a load of absolute rubbish about how solar is the problem and propaganda designed to maintain the status-quo of “more coal”.
Be under no illusion, the cumulative impact of these changes is profound.
The Renewable Energy Target is the single most important program in place to support solar and has been under constant attack. The Renewable Energy Target works and has helped reduce the cost of living for millions and employed tens of thousands in one of the fastest growing industries in the country. It’s self adjusting, ultra low-cost and designed to reduce over time.
Back to the insurance issue, you’ve got to ask yourself; do you feel lucky?
Right now, I don’t feel lucky. I think the risks are staggering. So I took out a very small insurance policy by supporting what I really think is our best chance of saving the RET – by supporting the campaign being run by the Australian Solar Council. It’s not the only campaign going on, but it is well-considered, tactically clever and is gaining huge momentum. It’s affordable business insurance with a high probability of returning my investment.
No matter how big or small your business is or where you are located be very clear about this – if the RET is axed you will sell less solar power. Every solar company in the country should by doing something right now if they want their business to survive, it’s that simple.
If you have solar, if you work in solar or if you want solar, don’t count on luck.
Post expires at 10:13am on Thursday March 12th, 2015