The key reason is that solar FiTs and electricity rates are based on completely different things.
When you buy electricity from AGL, the price you pay per kWh includes:
- paying the distributor to maintain the network and deliver the electricity
- meeting regulatory obligations
- the wholesale cost of electricity
- running our operations.
When you export solar, AGL pays you a solar FiT that matches the value of solar to the wholesale electricity market. At the moment, because there is so much rooftop solar flooding the grid during the day, the market value of exported solar has gone down, causing solar FiTs to decrease.
These things make retail electricity prices higher than solar FiTs.