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Anger as Fed Govt means tests solar panel reb -

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ELEANOR HALL: The director of a solar energy company says he will go out of business thanks to a
new means test introduced in Tuesday night's Budget. Under the previous government, households were
given a subsidy from the Federal coffers to encourage them to install rooftop solar panels.

Now the Federal Government has limited that $8,000 rebate to households with an income under
$100,000 a year.

And as David Mark reports, environmentalists, opposition parties and industry groups are condemning
the decision.

DAVID MARK: Installing a solar array isn't cheap. A typical unit for an Australian home costs
around $20,000, although a smaller array can be bought for around $12,000.

An $8,000 rebate has helped to reduce that cost significantly, but from Tuesday night that subsidy
is only available to households that earn less than $100,000 a year.

HAMISH WALL: I would expect that our business will probably drop revenue by about 80 per cent if
not greater. So, I would say it could well be the death of our business.

DAVID MARK: Hamish Wall is the general manager of business development with Nicholls Solar, a
company that install solar panels. He says he has already had customers cancelling orders.

HAMISH WALL: We have, we have and interestingly enough we had one household which consisted of a
nurse and a teacher and obviously under the Federal Government's policy, they're rich and therefore
they are no longer eligible for the rebate.

DAVID MARK: What were they planning to install?

HAMISH WALL: They were planning to install a one kilowatt system.

DAVID MARK: In other words they would have been about $3,000 out of pocket with the rebate?

HAMISH WALL: It would be $3,900 after the rebate.

DAVID MARK: But because they will be means tested, the cost will be closer to $11,000 or $12,000.

HAMISH WALL: That is correct.

DAVID MARK: What did they say to you?

HAMISH WALL: Well, they just said it was ridiculous and therefore they can't afford it, and it is a
real shame and you know, that is just the way it is. There wasn't much more that could be said and
obviously we couldn't do anything about it. That is the Federal Government's policy.

DAVID MARK: Erik Zimmerman is the director of Rezeko, one of the country's largest solar installers
and he's lucky. He has got customers in regional areas that earn less than $100,000 a year.

But he says his business has lost a million dollars in the past two days and that's because his
city customers simply earn too much.

ERIK ZIMMERMAN: In the cities of course, we are finding it is about 70 per cent of our customers
and in the urban ... sorry the rural areas, it is about 30 per cent.

DAVID MARK: Of those 70 per cent in the city, how many of those do you think will go ahead and pay
the full cost for the solar array?

ERIK ZIMMERMAN: Well, to date we have only had one so the answer is about 99 per cent won't and one
per cent will.

DAVID MARK: The World Today invited the Environment Minister Peter Garrett, to explain the decision
to introduce the rebate, but he wasn't available,

His spokesman told The World Today the "program targets those who can least afford to install solar
power without some assistance. We believe there will be continued demand for the rebates with the
new means test".

But the Greens spokeswoman on climate change and energy, Senator Christine Milne, has ridiculed
that logic.

CHRISTINE MILNE: Well at the moment, the only people who can afford to install solar panels on
their roofs are people earning a reasonable good income because low socio-economic earners are
struggling to even pay their mortgages and meet their petrol and food costs, and can't even
consider it even though they know that energy efficiency would reduce their long-term costs, it's
just not possible.

The big barrier is the up-front cost. The rebate made it reasonable, but putting on this ridiculous
means-tested rebate means the collapse of the industry and we have already had across the country
now, several people ringing our office with a supplier in Melbourne saying that he has already lost
a million dollars.

DAVID MARK: The collapse of the industry seems rather dramatic. Are you over-emphasising the impact
that this will have?

CHRISTINE MILNE: No, I think this is going to set in train the collapse of the solar panel industry
as it currently stands in Australia.

DAVID MARK: The Federal Government is talking up its decision to double the rebate program from
3,000 households a year to 6,000.

Peter Garrett's spokesman also points to the green loans plan, which is available to 200,000 homes
as well as the plan to put solar panels on 9,000 schools.

But the Australian Conservation Foundation's Don Henry says these programs don't go far enough. He
says the decision to introduce the means test will mean that the price of solar panels - which had
been falling - will now start to rise.

DON HENRY: We understand from suppliers that there is a real need to get the industry up-scaled
because that can help bring the costs down.

And so once again, anything we do to dampen this young new effort to get solar power on our roofs,
in our view is unfortunate. We really need to be going gangbusters on solar power in Australia, and
that should be across the board.

ELEANOR HALL: The Australian Conservation Foundation's Don Henry, ending that report from David
Mark.