Renewables, Solar, Solar

Solar the winner in new regulatory era

Diligent regulation of the Australian rooftop solar industry has been crucial to its success, writes Clean Energy Council chief executive Kane Thornton.

The Australian rooftop solar industry is currently in the midst of a golden age, with the sector adding a record amount of new capacity in each of the past five years. While part of this sustained success can be attributed to federal and state government incentives and rapid declines in solar panel prices, a significant factor is the reputation that the industry has built with consumers and businesses.

For many years now, the Clean Energy Council’s Accredited Installer, Approved Solar Retailer and Approved Products programs have been pivotal in maintaining the sector’s reputation by improving industry standards, educating installers and retailers, and weeding out those who continually or wilfully fail to meet the required expectations.

The recently completed review of the rooftop solar sector by the Clean Energy Regulator (CER) means the Clean Energy Council’s role is changing, with a strengthening of legal obligations of installers, retailers and manufacturers, and new regulatory powers for the CER.

This will create new opportunities to further improve standards across the industry and ensure the rooftop solar sector continues to be one of the key drivers of Australia’s clean energy transition.

Regulation the key to industry’s success

The rooftop solar sector’s growth in recent years has been nothing short of remarkable. In the past five years, the sector has installed more than 1.4 million new systems and added more than 11GW of new generation.

This has resulted in rooftop solar now accounting for almost a quarter of Australia’s renewable energy generation, and more than eight per cent of total generation.

Unsurprisingly, the growth of the industry has been mirrored in the number of accredited installers and Approved Solar Retailers. In 2021, the Clean Energy Council accredited 8682 solar installers and designers, which is more than double the number working in the industry in 2016.

The number of Approved Solar Retailers has seen an even more dramatic rise, with the number of companies signed up to the program rising from less than 50 in 2017 to more than 1450 in 2021.

While such stratospheric growth has had enormous positive benefits for consumers and the environment, it also carries with it increased risk of unscrupulous and unqualified operators entering the industry to try to exploit the significant opportunities on offer.

This is where the Clean Energy Council has traditionally played a crucial role through its regulatory programs, encouraging continuous improvement across the industry by helping installers stay up to date with the latest standards and guidelines, and operating a robust compliance process to educate and discipline those who fail to meet appropriate standards.

Enforcement just one part of a larger regulatory whole

Often when people think about regulation of the rooftop solar industry, they picture installers and businesses being reprimanded or sanctioned for substandard work or dodgy sales practices.

However, the reality is that an important aspect of the Clean Energy Council’s regulatory work has focused on equipping the industry with the necessary knowledge and capabilities that allow it to adhere to best practices and maintain the overall reputation of the industry.

At the highest level, this involves operating and maintaining the Accredited Installer, Approved Solar Retailer and Approved Products programs. In addition to their everyday administration, these programs encompass an extensive array of activities, including requiring rectification work, technical assessments and support, audits of business practices and advertising, and laboratory testing of solar components.

While the operation of these programs is the central element of the Clean Energy Council’s regulatory role, the organisation also engages in a host of other activities to improve the industry.

These include working closely with other regulatory bodies to set and maintain industry standards, running an extensive continuous professional development program to ensure installers’ knowledge is current, and representing the industry on specific projects or at relevant forums.

The success of these activities means there is a remarkably low level of non-compliance in the rooftop solar sector for an industry of its size. However, there are times when enforcement measures are required due to a continual failure to meet required obligations or a wilful disregard for guidelines and standards.

These cases come to the Clean Energy Council from a variety of sources, including the CER, state and territory electrical regulators, or direct consumer complaints, and they are thoroughly investigated by a dedicated compliance team.

In the period between 1 July, 2021, and 31 March, 2022, the Clean Energy Council resolved more than 1800 cases against accredited installers, of which approximately 75 per cent resulted in some form of compliance action. The most serious of these cases resulted in the suspension of 41 accredited installers, and the cancellation of nine.

Changing responsibilities provides new opportunities

In August 2020, the Federal Government commissioned the CER to conduct a review of the Australian rooftop solar industry. The review, which was released in September 2021, found that most Australian rooftop solar businesses do the right thing and that the Clean Energy Council has been undertaking its regulatory role diligently for a long period of time.

However, it also recognised the difficulties for the Clean Energy Council in undertaking enforcement against accredited installers and product manufacturers due to it not having the statutory investigation powers or in-house litigation resources of a Commonwealth regulator.

As a result, the review recommended the CER take a more active role in compliance and enforcement within the rooftop solar industry.

This represents a new chapter in the way the Australian rooftop solar industry is regulated, streamlining the system to provide improved enforcement outcomes, and better encompass consumer protection, electrical safety, retail practices and economic regulation.

It also represents a significant opportunity for the Clean Energy Council to further improve standards across the industry by focusing on providing installers, retailers and product manufacturers with all the information and help they need to complete solar installations to the highest possible standards.

The Australian rooftop solar industry’s strong reputation is one of the primary factors in the sector’s enormous success during the past five years. These changes to the way the industry is regulated will further bolster this reputation by allowing the CER to leverage its compliance and enforcement tools as a Commonwealth agency to crack down on the few instances of seriously bad behaviour.

It will also allow bodies such as the Clean Energy Council to work more closely with industry participants and other industry stakeholder groups to further improve standards across all aspects of the industry.

By doing this, we can ensure the industry’s current strong growth continues so the sector remains at the forefront of Australia’s clean energy transition.

Kane Thornton has more than a decade’s experience in energy policy and leadership in the development of the renewable energy industry. His column is a regular feature in EcoGeneration, where he analyses industry trends and explains the impacts of federal and state renewable policies on the energy sector.

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