Labour is promising two new long-term, low-interest rate schemes, kickstart subsidies and plug-in options for renters to make it easier for them to get solar power.
On Wednesday, the Labour Party announced its SolarSaver package in Auckland, with leader Chris Hipkins saying renewable energy is the cheapest form of electricity available, but too many households are locked out by the initial cost.
“SolarSaver creates a simple one-stop shop, provides affordable finance, helps renters access solar for the first time, and offers targeted grants for families who need extra support,” Hipkins says.
This is what’s in the package:
- Two new long-term, low-interest schemes: one through lines companies and another through establishing a Ratepayer Assistance Scheme
- Kickstart subsidies of up to $3000 for low and middle-income households which Labour says could cover the cost of a plug-in system
- A $30 million community battery fund (community batteries are large energy storage systems and store surplus energy which can be supplied back to the community when it’s needed)
- Labour says it would fix regulations so renters can use safe plug-in solar panels that connect to a regular power point The Energy Efficiency & Conservation Authority (EECA) would help households work out what suits their home, get quotes from accredited installers, and match people with the best finance for their situation
Labour says the SolarSaver package will cost $160 million over four years and it would be funded by repurposing the Government’s Gas Security Fund.
Broken down, the cost includes $77 million in household subsidies, $30 million for community batteries, $22 million for EECA to help with its delivery.
The Crown would underwrite $20 million for lines company loans and $7 million would go towards establishing the Ratepayer Assistance Scheme. There would also be $4 million for workforce development.
If elected into Government in November's election, Labour says the subsidies, loan schemes and EECA support would be up and running within 12 months of it taking office.
‘There’s something for everyone’
Hipkins says: “Low- and middle-income households will be eligible for subsidies of up to $3,000. We'll change the rules so renters can use safe plug-in solar panels, saving an estimated $300 to $400 a year. And we'll establish a Community Battery Fund so whole neighbourhoods can share in the benefits of cheaper, cleaner energy.”
“There’s something for everyone.”
Labour energy and resources spokesperson Megan Woods says the package was designed to get cheaper electricity into more homes and help New Zealanders save money on their power bills.
"We'll introduce two new low-cost finance options because four out of five households currently cannot access a standard bank green loan."
"Lines companies will be able to offer low-cost loans where solar installations benefit the local network, while a new property-linked finance scheme will allow households to repay costs gradually through their rates bill,” Woods says.
The loan through lines companies would be paid back gradually through the property’s power bill while the Ratepayer Assistance Scheme covers solar, batteries and other things like hot water heat pumps.
Asked for more details about the loans and interest rates, Woods told interest.co.nz the Ratepayer Assistance Scheme was designed to offer rates below current bank floating rates.
"At most, lines company loans will be offered at their regulated cost of capital, currently around 6.5%," Woods says.
"EECA will work with each household to find the best option and loan term for their situation. Independent modelling from SEANZ [Sustainable Electricity Association New Zealand] and Rewiring Aotearoa shows savings of around $1000 a year under the RAS and around $750 under lines company loans, based on a 15-year loan term for a typical 8 kilowatt solar and 10 kilowatt-hour battery system. Households may also repay early at any time."
Woods says the solar rollout would create local jobs for electricians, installers and roofers.
“Labour is focused on helping New Zealanders take control of their power bills through cheaper, cleaner energy.”
'Fundamentally different than what National is offering'
National released its solar policy about two weeks ago. Asked by reporters about how voters could potentially see Labour's policy as similar or matching National's announcement, Woods says: "We haven't just taken someone else's work and put our logo on it ... We've been thinking more broadly."
While the Ratepayer Assistance Scheme was one component, Woods says Labour had been thinking about how to work with lines companies, how to broaden finance options for people and how to get more people to have solar.
Woods says Labour's package is more comprehensive and covers off every aspect. "This is fundamentally different than what National is offering."
But in a statement, National's Campaign Chair Simeon Brown, who is also the party's energy spokesperson, says Labour's announcement is essentially National's policy "but with a bigger price tag".
“They've managed to take the same idea and make taxpayers pay more for it."
What about passing a scheme now?
Asked if Labour would work with National to get some solar initiatives across the line before the election, Woods says absolutely.
"They could have at any time over the last two and a half years and we would have voted for it, as we often do."
Following Labour's announcement, Green Party co-leader Chlöe Swarbrick says with both National and Labour in support of a Ratepayer Assistance Scheme, "there's no reason we can't progress on a cross-partisan agreement to do this right now".
"The Greens have offered the National Party our 15 votes to pass this scheme since the fossil fuel crisis first hit, months ago. Now both the legacy parties are on board, why don't we just get on with formalising the agreement already locked in? Every month waiting is another month families pay more than they need to for the basics."
"Passing the scheme right now takes unnecessary point-scoring off the election table, locks in progress and puts solar panels on roofs sooner. We can then have the election contest over the things parties genuinely disagree on," Swarbrick says.
'We all have a role to play'
Electricity Retailers' and Generators' Association of New Zealand (ERGANZ) chief executive Bridget Abernethy says Labour's policy sends a positive signal and says she welcomes bipartisan support for policies that accelerate access to electricity.
“It’s great to see the two biggest political parties announce policies designed to help more Kiwis electrify, along with National’s proposed Home Energy Fund announced last month.”
Members of ERGANZ include Contact, Genesis, Mercury and Meridian.
Household electrification needs enduring policy that lasts the length of investments, Abernathy says, and ERGANZ looks forward to learning more about the measures, particularly those that may require retailer involvement.
Local Government New Zealand (LGNZ) has welcomed both National and Labour's solar announcements.
"We all have a role to play in making households more affordable, and the Ratepayer Assistance Scheme is one of the most effective ways to do that," LGNZ chief executive Scott Necklen says.
Speaking about Labour's announcement on Wednesday, Necklen says: “The announcement today shows the potential for central and local government to work together constructively to tackle the challenges facing Kiwis."
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