Presentation slides

documentasset::Targeting compliance in the small scale renewable energy scheme in 2018

Thanks Everyone,

As mentioned, yeah, Michelle Crosbie. I am a General Manager at the Clean Energy Regulator. My area of responsibility at the moment is the Small-scale Renewable Energy Scheme.

Today I’ve got Michael Whitelaw- He’s just here- with me. Michael is the manager of the SRES Operations Team at the Regulator. And Michaels Team receives the thousands of applications for STC’s that we get each week.

Now Nigel mentioned beer time and talking about compliance probably isn’t one of the most exciting things to be talking about at the end of the day. But if you hang around, one Michael and I will stay afterwards for questions but we also have a video to play of Nigel that even Nigel hasn’t seen, so it might encourage you to hang around a bit longer – or not. Yes, I don’t know- I think Nigel will stay because he’s probably keen to see what we are going to show.

So today, yeah we are talking about compliance activities. I’m going to focus initially on what we’ve been up to last year in terms of our compliance work, and then I’ll have a look at this year and what we are planning to do for the rest of the year.

Last year we actually broke records, I think Michael hit 1.1 gig for 2017 at the last numbers we looked at and that could go up. And looks like we are going the break records in 2018, so its important context we we’re thinking about our role in administering the scheme.

When we talk about compliance focus areas the- I talk about four things at the moment that, I guess, keep me up at night if we say that. So we’ve got:

• Unapproved panels
• Non-installations of systems
• Misuse of installer details, which I’m sure many of you would be interested in
• And agents competency and capability

So when I take about unapproved panels, I’m talking about substandard panels, non-genuine panels, counterfeit panels, there’s a whole range of terms that we use for them. Primarily from our perspective there not meeting Australian standards, there not going to perform as long as they should, there not going to last as long as they should, not perform as well as they should and probably don’t come with warranty for the consumer.

Customers don’t get what they paid for, government whose paying a proportion of the cost of these systems doesn’t get the generation that they are paying for and industry is undermined by these players in the market and can’t compete with these low quality, low cost systems.

Non-installations is probably a little bit more self-explanatory. So unfortunately we see a small number of business that are reporting to be solar retailers, approaching our agents and asking them to create STC’s for systems that aren’t on roofs. We’ve seen that over the last, well since I’ve been in the scheme, the last three years it’s been happening and I think today we put a notice out to our subscribers saying again we’re seeing it. So one that on our radar.

Misuse of installer details, interestingly continues. And I think we probably talk about this each year but we continue to see claims coming through for STC’s with installers I.D’s being used for installs that they haven’t done. Now I guess all I can say to you there, and I think we’ve said this in the past as well, is let us know if you think that happened and we can work with you to have a look if it is an issue, because we have the whole data set. We can relatedly quickly have a look at whether we have a problem. And the other thing, I think advice we’ve given in the past, is go back to the CEC and change your installer I.D. so that’s probably the first they you’d do if you start having concerns about your information being misused.

The final one is around agents competency and capability, and I’m going to talk a little bit about that more today so I won’t sort of dwell on that. But the agents are critical to the integrity of the scheme, they’re the ones that are creating STC’s under law, and so we’ve got a program of work this year that I’ll talk about in terms of work we’ve been doing with the agents in that space.

So this year, or sorry last year, this probably looks a little bit like Rick’s michelleSlides from earlier showing the rollercoaster ride of the STC’s.

So last year what we did, we talked about four things that we’ve been worried about, we actually established for the first time a serious non-compliance team within the agency. It was around February last year, and we appointed a manager, who might be known to some of you, Brian Davies, he’d been working in the agency off and on over the years in the investigations team. So since Brian has come on board we’ve really ramped up our compliance monitoring activities and our enforceable actions. And hopefully you’ve seen some of that through media releases and notices that have gone out to subscribers, hopefully have felt some of that. We’ve, in terms of the enforcement action, we’ve executed monitoring warrants, entered into a number of enforceable undertakings throughout the year. Where necessary temporarily suspended accounts and where necessary permanently suspended accounts and in fact Brian Davies can’t be here with us today at the conference because he’s been onsite on a case where in the last day we’ve had to temporarily suspend two accounts with concerns to both unapproved panels and misuse of installer details.

The other thing, we had Luke Barlow from AEMO here earlier, and one of the things we’ve been doing which is fairly innovative and important to the Regulator, is sharing data with AEMO. So we give AEMO or PV data, so the data we collect about solar systems and AEMO gives us there metadata. And so what we can use this for is the non-installs, so the AEMO data tells us about the consumption at a location, and we use that consumption data to tell us the likelihood of whether a system is on the roof or not around the time of the install.

Now I’ll talk a little bit further about batteries, but we can go one step further. Luke talked about the distributed energy register that AEMO are going to create. We are assisting with that and we are providing data to support that register.

I think at the last forum we talked about replacement panels and hopefully you are all aware, we have actually clarified and provided some guidelines on our requirements for replacement panels under the scheme, so I think that was last year.

The other thing we’ve had over the year are questions about is the boundaries in the SRES and LRET, and the intent of the SRES. So we see new business models coming through all the time and testing those boundaries of the two schemes and so you’ve published some guidance material about both of those things, and the feedback so far is that that has been useful. But it would be interesting to know whether or not that has been the case.

Inspections program continues, I think some of our speaker have already spoken about the inspections program, so to date we’ve done over 20 thousand inspections under the program. Each year we do around two – three percent of installs for the year, and we inspect those installations and it’s an important part of our compliance program and will continue.

I thought it might be useful, Michael helped me pull this together from the perspective of his team, but what the top three things that we see coming through that cause a failure or a time delay in the STC’s being processed. Now the first is interesting and it’s something that is evolving because of the time or life of the systems and the age of the systems. But the first one we see is when we aren’t told about an additional systems being added to the site, we assume that that is a duplicate. So in the REC Registry you can provide some information to us on whether it’s actually an additional system to a system that you’ve already claimed STC’s for. And that’s really important information for one, making sure the application isn’t failed, and two just generally slowing the application down. So if you can help the agents by providing that information that’ll help speed up the processing.

The second one, and it’s always been an issue, is being very accurate with the location of the system, so the location on the address of the system. Again we use that, that’s a key piece of information we use when we validate the certificates, and if we’re not able to get a match on the location or we again are getting duplicates or unable to identify that location, that’ll slow the processing down. So that’s one piece of information that I’d say is important to really get accurate and when you are sending through the information to your agents, and the agents are then passing that on to us.

The other one I guess is interesting, the third one is the contact details of the system owner. So it’s one of those things that maybe isn’t, you think, isn’t as important and potentially not given to you accurately by the system owner, but it is one of the things we do check, and we do ring the system owners. And so when the information isn’t accurate and we can’t get on to them, that slows the processing down as well.

So there are the top three for you and hopefully that does assist in terms of the information you are gathering.

I talked about Batteries, and Luke earlier from AEMO talking about the battery register. In the last few weeks we’ve actually added some additional fields into the REC Registry to assist AEMO. Collecting a little bit of additional information about batteries and if it’s installed at the same time as the solar system. As you may or may not be aware currently we do ask that question “Is the battery installed at the time of installation”, importantly it’s not part of the eligibility requirements for the STC, and it will not be in the future part of the eligibility requirements for the STC process and the claim.

But it is invaluable information for AEMO, for managing the grid. I think earlier John was talking about first respondents to emergency, and that information, if we can share that with emergency services is really valuable. And also for yourselves, I think again John talked about the Intel for industry. So we publish at the moment the information we do publish about batteries on our website at an aggregated level. The additional fields that we are electing as of a few weeks ago are make and model, whether or not the default settings on the battery have been changed, and whether it’s part of a broader aggregated system. Now it’s voluntary information and it’s going to good use, and I think it benefits us all, so if I can encourage all of you to provide that information through to your agents and for the agents to pass that information on. I think it’ll be better for everyone in the industry and everyone involved.

So talked a little bit about the areas that worry me, and keep me up at night and my colleagues. There are some really positive stuff that we’ve been doing over the last 12 months and that will lead into this year. There’s two things, and I talked about the video, so I’m going to leave the unapproved panels and serial number project till the end. But the first project that we’ve been working on with agents is around agents’ capability and competency, so we’ve had a working group who’ve developed a set of expectations on what those capabilities and competencies are for agents to participate in the scheme. We are going to roll out in May for any new participant who’s going to register as an agent to create STCs a knowledge framework and a self-assessment, and they’ll need to be completed prior to the applicant being able to submit their application in the REC registry. For existing agents, we’ll give a transition of about six months for them to be able to undertake the knowledge check and self-assessment. Now it won’t be mandatory for existing, but if existing agents don’t complete that self-assessment we’ll be more closely monitoring them after that period. So I think that’s a real positive because we do have again a small number of agents that we do have concerns about their due diligence processes, dealing with third parties and their compliance processes when under law creating STCs. And they’re critical to the integrity of the scheme and we call them the sentinels for the scheme.

We’re out and about, we have a project that’s running were we are going out and meeting with our top creators of STC’s over May and April. The purpose of those meetings is to start talking about those expectations we have of agents and find out a little bit more about their business operation. So you may if you’re an agent as well had some contact from the team.

So I’m now going to talk about solar panel validation. So this is my favourite project that I’m going to talk about now and hopefully it’ll be great if you’ve heard about it. We’ve partnered with industry to solve a common problem of these unapproved or substandard panels in the market. I’ve been working on it and some of us in the room have been working on it for a couple of year actually, so it’s taken a while. But we are getting really close. And so we’ve got the working group that we’ve been working with and our partners have rolled out a pilot where we are actually validating solar panel serial numbers back to the manufacturer. The solution works – it’s very simple –it’s reusing what’s already out in the market, the pilot partners have enhanced the apps, that many of you probably use today to go out and collect information about the systems. So the apps have been enhanced so that the installer can scan the serial number on the panels on sight and straight away it pings off to verification servers and says tick these are genuine. Now we are getting that information from the manufacturers and the manufacturers are saying yes this product meets Australian standards, it should be in Australian, its CC accredited. It connects the manufacturers’ right through the supply chain, so to the retailers, the installers, the agents, to ourselves and really importantly to the customer. So the customer can get confidence that they are getting what they paid for, and they are getting warranty with the product.

What I love about the solution is we talk about ‘we facilitate’ the regulator facilitates the solution, but it is industry owned and industry led. And its empowering industry to self-regulate and if we walk away, which is possible at some point- well definitely going to happen at some point- the solution is sustainable, it still adds value, it can still be used by industry. The exciting thing is it can probably be used for batteries and probably other consumer products as well. So I guess that’s the next step after the pilot.

At this stage the pilots running, we’ve got three partners that we are working with on the pilot- FormBay Solar Scope and Bridge Select- so they are building the apps and the validation services. And we’ve got industry leaders in the manufacturing group, we’ve got Canadian Solar, Jinko Solar, Yingli, LG Australia, Hanwha q cells and ReneSola all on board and we’ve got all their data to validate that against. So it’s a fantastic start for the pilot

Now next January we are going to intend to roll it out to industry, and so we are really interested and keen to get anyone who would like to be involved to come and talk to us and to the industry partners and start getting on board not. Because there is a little bit of lead time needed to get your apps ready and to get the manufacture details into the verification servers.

We’ve put together a video, and this is just one of the parts of the video. Thankyou Nigel for doing that and we’ve got representation from all the supply chain, installers retailer, manufacturers and the like. So the video is out there playing at the moment, and we’ll put it up on our website.

Sorry to keep you a bit longer than we intended. So thank you.