Are Feed-in Tariffs suitable for promoting solar PV in New Zealand cities?

Feed-in Tariffs (FITs) implemented by city councils in the USA have proven an effective means of stimulating installation of renewable-electricity generation capacity at a local level, and may also be effective for New Zealand cities. Though New Zealand has a high proportion of electricity generated renewably, this is mostly from centralized hydroelectricity plants. The suitability of city-level FITs for promoting solar photovoltaic panels in New Zealand is examined. Findings suggest that FITs, with rates obtained using the cost-of-generation method, could be implemented in New Zealand cities at rates comparable to those in successful FIT schemes internationally. The unique structure of New Zealandʹs liberalized electricity market, however, is likely to make financing FIT schemes at city-level more complex than the equivalent situation in the USA. Benefits of introducing such schemes will include the possibility for purchasers of solar PV systems to calculate returns on investment over the long term, and the streamlining of the grid connection process by reducing the number of authorities involved.