26 Sep PENSIONERS HIT BY SOLAR BONUS SCHEME TARIFF
The NSW Government’s grid feed-in tariff was introduced back in January 2010 as a major incentive to encourage people to install solar energy. The energy produced by the system would be credited to the home owner at a rate of 60 cents per kWH. Many home owners, including pensioners installed solar energy systems as the grid feed-in tariff could ‘pay off’ a 1.5kW system in less than three years.
Toward the beginning of this month (April 2010) news reports were released stating that credits received for solar energy would be assessed against pensioner’s incomes. It started a panic amongst pensioners that had installed solar energy systems, and those that were considering installing solar energy systems to their homes. However, on 14 May 2010, the commonwealth government issued a media release to clarify the way feed-in tariffs would be assessed for the purpose of the pension income test, revealing that in most cases there would be no affect on pensions. The media release stated the following:
- Feed-in tariffs that are paid to pensioners as a credit on an electricity bill will not be assessed as income under the pension income test.
- Power sold back to the grid in return for cash, cheque or a direct deposit is counted as income for social security purposes.
As long as the tariffs are credited against electricity usage, pensions are not affected. This remains true as long as the credit is less than the bill. If a solar system is installed and it produces more income than the electricity expense, then there may be an assessment issue, however, it would have to be quite a substantial amount to have an effect.
For further information on how pensions or other payments may be affected by the Scheme, customers should contact Centrelink to discuss their individual circumstances.