The new “Solar Sharer” scheme promises three free hours of electricity in the middle of the day for households in Queensland (QLD), South Australia (SA), and New South Wales (NSW). On the surface, it looks like a win, using surplus solar energy that would otherwise go to waste. But free electricity is rarely free of trade-offs.
Behind the headline offer lie cost-shifting risks, from higher fixed supply charges to declining feed-in tariffs. The policy could even weaken homeowners’ incentives to invest in their own solar and battery systems. Understanding how these hidden costs emerge is essential because what looks like a reward for clean energy could easily end up costing solar households more in the long run.
The idea behind midday “free electricity”
The government’s new midday energy plan is designed to solve a growing problem in Australia’s power system: too much solar at once. Rooftop solar has become so widespread that, during the middle of sunny days, electricity supply often exceeds demand. Wholesale prices then crash (sometimes to zero or even negative levels), forcing large generators to curtail production and creating instability across the grid.
To manage this, the federal government has asked retailers in QLD, SA, and NSW to offer households three hours of free power in the middle of the day. The goal is to shift energy use from evening peaks to daylight hours, soaking up excess solar and reducing pressure when demand surges after sunset.
In principle, the concept makes sense. Encouraging consumers to run dishwashers, charge electric vehicles (EVs), or cool homes during periods of oversupply can stabilise the grid and reduce reliance on fossil fuels. But while the plan might ease operational stress on the energy market, it also changes how retailers recover costs, and that’s where the risks begin to appear, particularly for homeowners who already generate their own power.
The hidden trade-offs
Free electricity in the middle of the day might sound like a bonus, but the cost has to be recovered somewhere. Retailers don’t simply absorb the loss; instead, they shift it. The most likely outcome is higher fixed daily supply charges or increased evening rates to balance the books. That means households could end up paying roughly the same overall (or even more) despite the “free” window.
There’s also a grid stability risk. If thousands of households decide to charge EVs, run air conditioners, or heat water at the same time, local distribution networks could face sudden strain. These systems were never designed for simultaneous high loads in concentrated time slots, even if the energy itself is cheap or free.
Finally, the offer doesn’t align with the realities of solar generation year-round. In winter or during overcast periods, midday output drops sharply, meaning there may be less surplus energy to go around. What seems like a simple incentive can quickly become a balancing act, one that may solve short-term market pressures while creating new financial and technical challenges for households with solar.
Impact on solar households
For households with rooftop solar, the “free power” promise is more complicated than it appears. Most solar homes already generate their own electricity during the same midday window when the scheme applies. In practice, that means many won’t benefit from free grid energy at all—their systems are already covering their needs. Instead, they risk losing value elsewhere.
When everyone uses more electricity at midday, feed-in tariffs (FiTs) fall further. Retailers pay less for exported solar because the grid is flooded with cheap energy. The surplus that once earned a modest credit now returns very little, eroding one of the key financial benefits of owning solar. In some cases, those exports could even be curtailed if network congestion increases.
Battery owners face their own trade-offs. Charging a battery from the grid during a “free” period might seem tempting, but it displaces solar generation that could have filled that storage at no cost. Over time, this weakens the payback on both solar and battery investments.
The broader effect is subtle but significant: policies like these can blur the value of self-generation. If grid power becomes effectively free for part of the day, the long-term incentive to install or expand rooftop solar may decline, undermining the very renewable capacity that created the surplus in the first place.
How to avoid the hidden costs
You can still come out ahead, but it takes awareness and a few strategic adjustments. The key is to treat “free electricity” offers as marketing tools and not guaranteed savings. Here’s how to stay in control:
- Scrutinise your plan: Before switching, check whether the retailer has increased your fixed daily supply charge or adjusted evening tariffs to offset the free period. What you gain at midday could be lost after sunset.
- Watch your feed-in tariff (FiT): If the free-power window overlaps with your highest solar export hours, you could lose export value. Track your credits to make sure the offer doesn’t reduce your overall return.
- Use power on your own terms: Time household energy use around your solar production, not just the retailers’ schedule. Running appliances directly from your panels remains the most efficient use of free energy.
- Optimise battery strategy: If you have storage, charge primarily from your own solar generation and discharge during evening peaks, when power is most expensive. Don’t rely on grid “free” periods to fill your battery.
- Compare offers regularly: Energy retailers compete aggressively with promotions. Reassess plans at least once a year to ensure new incentives aren’t masking higher base costs.
Balancing incentives
The goal is sound for the “free power: offer, but if these incentives aren’t carefully structured, they risk dulling the motivation to invest in home solar and storage. The challenge for policymakers is to create pricing models that balance both sides of the equation: shifting consumption patterns without undermining self-generation. That could mean pairing free-power windows with stronger export management tools, better network planning, and time-of-use tariffs that reward flexibility instead of blanket giveaways.
The grid is moving from a system where energy scarcity drove prices to one where timing and flexibility define value. For homeowners, understanding when power is cheap, when it’s not, and how to use your own generation strategically will be what separates those who benefit from the renewable shift from those who simply watch it happen.
The idea of free electricity at midday taps into Australia’s solar success story, but it oversimplifies a complex system. Retailers still need to recover costs, network infrastructure still needs investment, and the value of solar exports continues to fluctuate with market supply. For homeowners, that means these offers should be approached with clear eyes, not excitement.
Free daytime energy might help balance the grid, but it doesn’t guarantee lower bills — and in some cases, it could erode the financial return of your own solar investment. The smarter approach is to stay informed, use solar power directly whenever possible, and keep an eye on how new tariffs reshape both grid demand and household economics. The energy transition is accelerating, and those who understand the fine print will be the ones who benefit most from it.
Energy Matters has been in the solar industry since 2005 and has helped over 40,000 Australian households in their journey to energy independence.
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