Does - REBATE TO BE SLASHED! - boost solar sales?

The latest solar sales data is in - so are customers responding to threats about the end of the rebate? And is it a fair claim, anyway, given the Senate is saying the Warburton Review is 'dead on arrival' and should 'go in the bin'?

I’m sure you’ve all seen the advertisements for solar systems screaming: ‘REBATE TO BE SLASHED!  GET YOUR SYSTEM NOW BEFORE IT’S TOO LATE’

I know of a neighbour who has been told by solar system sales people, in no uncertain terms, that the rebate will (not 'might') be abolished soon.

Of course, given the observations below about the Warburton RET Review report, one suspects its recommendation to abolish the solar rebate is highly unlikely to pass the Senate:

– Labor: “It belongs in the bin.”

– Palmer United: “Warburton report is dead on arrival."

– Greens: “Everyone can see it for the climate denier drivel it is."

So why are solar retailers telling customers such things?

Simple – the withdrawal of government money is one of the most sure-fire ways to stop prospective customers from procrastinating and sign on the bottom line. In the past, sales of solar systems have traditionally surged by large amounts in the lead up to the withdrawal or reduction of government rebates and feed-in tariffs.

Yet it seems that these threats of rebate withdrawals which have been going for a few months now, are having minimal effect in boosting sales, based on the latest data from Green Energy Markets.

The chart below details kilowatts of capacity installed by state and residential (green) versus commercial (blue) rooftops. Overall, capacity installations have been pretty stable and are tracking quite close to the small-scale renewable energy scheme target set by the Clean Energy Regulator early this year.

Figure 1: Installed capacity for residential and commercial (10kW-plus) solar systems by key states (Click chart to enlarge)

Source: Green Energy Market STC Snapshot – August 2014

This suggests that maybe customers don’t rely, thankfully, on what they’re told by solar salesmen. They may be more attuned to responding to a rebate withdrawal if they hear about it from the media or direct from government.

The one wrinkle to this analysis, however, is that this sales data suffers from lags of a few weeks. The mainstream media’s coverage of this issue spiked right at the end of August and in early September with the release of the Warburton Review. This could mean that the threat of a rebate withdrawal could have led to a spike in sales, but will only be evident in next month’s data.

Nevertheless, solar retailers might want to be more careful using rebate-withdrawal threats given they may not be all that effective when not backed by supporting media coverage ... and could get them into trouble with the ACCC.