Nats claim solar power subsidy 'has backfired'

Nats claim solar power subsidy 'has backfired' 5:00AM Tuesday August 14, 2007
Changes to the solar water heating initiative have backfired, causing the first decline in the number of new installations in years, National's climate change spokesman Nick Smith said yesterday.Last November the Government announced a $15.5 million climate change initiative that included an increase from $300 to $500 in financial assistance to homeowners for loans.

Government spokeswoman Greens co-leader Jeanette Fitzsimons said the goal was to double the number of systems being installed.Figures from the New Zealand Solar Industries Association show that in the first six months of this year installations were down 5 per cent on the previous year.At June 2006, 2017 installations had been done, in comparison by June 2007 only 1923 had been completed. This compares with an average annual growth of 37 per cent before the Government announcement in November.

Dr Smith said the policy had backfired because Ms Fitzsimons believed she could regulate down the price of the solar water heater systems, when it was best left to the competitive market.

"A further problem is that the Government's new Building Act is adding hundreds of dollars in costs to solar heating systems by requiring building consents, when it would be far less costly to regulate standards through accredited installers," Dr Smith said.

Ms Fitzsimons said she did not think the pricing arrangement for solar systems was unreasonable."It has to be sold at a price which means it will pay for itself over its 20-year life," she said on TV3. "I don't want consumers to be conned into buying solar water heating that isn't cost effective for them."- NZPA
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Gary Moller comments:
I wonder when the politicians are going to acknowledge the real reasons why there have been no sign-ups. It is because the New Zealand public is not stupid and NZ is such a small place that the word gets around very quickly. The internet helps and when it comes to the internet, the average Kiwi is savvy. The drop in sales coincides with the launch of this website in December 2007.

A "20 year life" is highly assumptive to the point of being ridiculous. I have yet to find a solar water heating system that is lasting anywhere near that kind of time without showing significant signs of deterioration. 5-6 years would be more like it (For evidence, browse the dozens of posts on this website using the "labels" tab in the right hand column).

If there is to be a 20 year lifespan, or near to that, then we must place the emphasis on quality rather than price. I do not believe that it is possible to make cheaper solar water heating systems without the serious risk of compromising performance and durability.

A solution to the problem of cost-effectiveness, in the face of the need to improve quality, is to increase the price of oil and electricity - but what politician is going to recommend that!

Smith seeks handouts for non cost-effective products

Press release: Jeanette Fitzsimons (Govt Spokesperson: Energy Efficiency)14th August 2007

Nick Smith’s proposal that the Government should subsidise solar water heaters that are not cost-effective for customers is astonishing, Government Spokesperson for Energy Efficiency Jeanette Fitzsimons says.

“This is the party that wants low taxes and reduced government spending. Yet Dr. Smith wants to use taxpayers’ money to give grants to solar water heaters that are sold at a price so high that the energy savings will never pay back the initial price,” Ms Fitzsimons says.

“The solar water heating programme agreed between the Government and the Green Party, has focussed so far on improving the quality of products and installations. This package includes: a new quality standard ; performance modelling to establish energy savings ; training courses for installers and an information website for consumers that shows which systems have passed their tests, and the price at which they will be cost effective.

“We are totally committed to ensuring the consumer gets quality and value for money when they choose to invest in solar heating,” Ms Fitzsimons says.

“The new grants for volume builders, announced just a month ago, are already bearing fruit.

“Builders are teaming up with solar suppliers, and the first grant for a group of at least 20 homes has been signed off. The informal advice is that builders are putting together proposals for a further 1,300 systems.” Ms Fitzsimons says.

Ms Fitzsimons is confident that the temporary reduction in sales cited by Dr Smith is a short term effect while the solar industry gets its systems tested and modelled, and more installers are trained.

“In the short term, I expect that most grants will go into groups of new homes,” Ms Fitzsimons says.

“In the longer term, with a number of new entrants waiting to enter the market,. I expect retrofit installation to resume. And they will be high quality products and high quality installations - at a price that is cost effective for the householder and for the country,” Ms Fitzsimons says.
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Gary Moller comments:
This is probably as close as we are ever going to get in the way of an admission that there are serious quality issues to do with solar water heating systems.

While I have no doubt that the industry will eventually get its house in order, I still ask the question:

"What is Ms Fitzsimons and the others who have been actively encouraging the installation of these devices on rooftops, going to do to help the many thousands of families and small businesses who are lumbered with installation and performance problems?"

Why should they be left out in the cold to carry the inconvenience and costs of the mistakes and sloppy work of others who profited off them in the process?

Ms Fitzsimons has known for a long time that there were serious problems. I know because I told her so last year and she ignored the warnings. She went ahead and encouraged us to install products that may actually be damaging to the environment (Energy intense to produce, costly landfill material when dumped).

Further, how can a responsible environmentalist continue to encourage the installation of these devices when there is absolutely no evidence that the products of today are any better than those of yesterday? The NZ standard that Ms Ftizsimons places so much faith in for saving her scheme does not in any way address the quality issues that are profusely documented on this website. The Emperor has no clothes.

I would hope that the solar water heating systems that are being installed under the Government's grant scheme come with proof that they will last 20 years as the Government would have us all believe.

At the least, there should be some kind of product recall of the thousands of faulty systems known to already be out there.

Finally, I do tend to agree with her about Nick Smith. But both of them are skirting about the main issues - conveniently avoiding the inconvenient truth.