The “solar sharer” offer, due to be available from July next year, aims to encourage households to use more electricity in the middle of the day – when solar energy is plentiful.
Energy Minister Chris Bowen said he hoped the initiative would benefit the grid by providing relief during peak periods.
“We are a solar nation … with 4.2 million households that have solar panels on their roofs,” he said.
How do I get free solar power?
To use the offer, customers need a smart meter. Households without smart meters can request one from their energy supplier and most will install one for free.
Different energy companies may offer different solar sharing plans as long as they meet the minimum criteria set by the Australian Energy Regulator.
Further details of the plan still need to be finalized, with the Energy Department and the regulator currently seeking feedback.
After the initial rollout, the government plans to consult with other states to expand the offer to other locations by 2027.
What if I don't want to wait?
If free electricity sounds tempting, households don't have to wait for the regulated offer.
AGL's Three for Free, Red Energy's Red EV Saver, GloBird Energy's ZeroHero, OVO Energy's Free 3 and Synergy's Midday Saver all offer free electricity periods.
The ACCC estimates that 79% of households could save money by switching to a cheaper deal.
The Australian Government's Energy Made Easy website compares energy price offers in NSW, Queensland, South Australia, Tasmania and the Australian Capital Territory. A similar tool is provided by the Victorian Government.
More than 4.2 million Australian households now benefit directly from solar panels on their roofs.
“Solar customers have consistently lower bills, around 18% less than non-solar customers, despite using more electricity from the grid,” an ACCC report said.
“Customers with solar and battery systems pay even lower bills.”
Which households are likely to benefit the most?
Bowen says the solar sharer offering will benefit households that can shift their electricity usage to the zero-cost electricity phase – such as professionals or families working from home, retirees or customers with smart devices that need to turn on in the middle of the day.
For others, the solar sharer may not be the cheapest option. “It was never claimed that this was a one-size-fits-all solution to all problems,” Bowen says.
Brian Spak, general manager of policy and advocacy at Energy Consumers Australia, says low-income households may have limited ability to benefit from these plans.
“The best way to maximize savings is to use more energy when electricity is free and less when it is expensive… but that is easier said than done,” he said.
“It can be difficult for households where no one is home during the day to use cheaper electricity.”
How do I make the most of free electricity?
Helen Oakey, CEO of Renew, a national nonprofit that promotes sustainable living, says, “It’s all about being smart about your timing.”
“Run your dishwasher, washer or dryer in the middle of the day rather than in the evening. Set your hot water system or heat pump to run during the day.”
Households can also set timers to preheat or precool their homes during times when electricity is free or cheap, she says.
“If you have an electric vehicle, you can plug it in for a midday 'sun snack' instead of charging it overnight.”
According to Oakey, a well-insulated, efficient and all-electric home will “perform every kilowatt more.”
“Replacing gas appliances with electric appliances that you can run during the day is one of the easiest ways to get more benefit from solar energy – whether on your own roof or someone else’s!”
Will free solar power make my bills cheaper?
Some are skeptical about the need for government intervention.
“I'm not sure anyone will necessarily benefit from this. It depends on the sum of their consumption and the prices that apply outside of those periods,” says Prof Bruce Mountain, the director of the Victorian Energy Policy Centre.
“This is populist nonsense,” he says. “These things have been on the market for a long time. There's no need to mandate them.”
Mountain says households can already opt for plans with zero-cost periods – he himself has been on such a plan for three years and switches his dishwasher, washing machine and electric vehicle charger to make the most of those hours.