A government mandated 8 cent feed-in tariff paid to PV owners in Queensland, Australia by the state’s two main power distribution companies is to be scrapped.

After 30 June the tariff will cease to be regulated, meaning owners will have to negotiate directly with the electricity retail business in the state in order to receive any payment, the state government has said.

Queensland’s energy minister Mark McArdle said the move would put “downward pressure” on electricity prices, which he claimed would have carried on rising as a result of the tariff.

“Left unchecked, the 8 cent feed-in tariff would cost Queensland households and businesses an extra $110 million on their power bills over the next six years,” he said.

“The changes announced today will lift the cost burden from the network businesses, making the scheme fairer for all Queensland consumers. These reforms will mean electricity retailers will pay any newly negotiated solar tariff direct to users.”

However, some 280,000 PV users who signed up to a larger 44c/kWh tariff, which closed to new applicants in 2012, will still remain eligible for the payment until 2028.

As a result, the Electrical Trades Union said the impact of the changes to the smaller tariff on electricity prices would be “negligible” as well as “unfair”.

ETU state organiser Stuart Traill said: “Abandoning those customers on 8c to deal directly with retailers is impractical and unfair. Does the government seriously expect householders to negotiate with large energy corporations?”

Lindsay Soutar, national director of advocacy body, Solar Citizens, said: “There are 40,000 homes that are about to lose the already too small financial return they receive from providing clean energy back into the grid.”

“This is incredibly unfair. It is obvious that it will be difficult for individual households to get a good deal from their power company. They simply don’t have the negotiating power. When retailers set the rules, solar owners lose.”

A campaign launched by Solar Citizens against the cutting of the 8c tariff has already collected 3,500 of a target 5,000 signatures.