Thousands of WA households may not put solar panels on their roofs if moves by the Federal Government to slash subsidies for the systems are successful, installers have warned.
A review of Australia's renewable energy target was released this week, calling for upfront subsidies for small-scale solar systems to be scrapped immediately or phased out by 2020.
Amid rampant demand for the technology - there are about 150,000 WA homes with solar panels - the suggestion prompted howls of protest from the renewable energy industry.
The WA Renewable Energy Alliance said killing off the subsidies could turn away thousands of customers who would have otherwise been expected to buy the systems.
Alliance chairman Richard Harris warned such a change could have devastating implications for the solar industry, which he said employs more than 13,000.
Claiming that middle to lower income earners were the biggest beneficiaries of solar panels, he said this group would be hardest hit if the Government axed the scheme.
Ian Milne, manager at Perth-based installer Avant Solar, said the subsidy was typically 35-40 per cent of the retail cost of a solar system, which in many cases amounted to thousands of dollars.
Under the renewable energy target, 20 per cent of Australia's power needs are to be sourced from renewable energy projects such as wind farms by 2020.
The review, headed by businessman Dick Warburton, said falling demand for electricity meant the fixed nature of the target was forcing more power in Australia's energy grids than needed.
It said this was under- mining Australia's productivity and it recommended the target be scrapped or pared back to the level of underlying electricity demand.