Soaring uptake of rooftop solar panels and subdued demand for electricity have put a massive dent in the output of State-owned power provider Synergy’s ageing generation fleet.

In its annual report tabled in Parliament yesterday, Synergy revealed it had booked a $24.3 million after tax profit in the 12 months to June — a $36.9 million turnaround on the $12.6 million loss the year before.

However, the profit came only after the utility was able to strip more than $130 million in costs out of the business.

Synergy chief executive Jason Waters said it was a trend that would need to continue if the corporation wanted to stay in the black, with electricity sales across the business falling 5.9 per cent for the year.

Part of the fall was attributed to households, where demand for electricity from the grid declined almost 4 per cent “due to unfavourable weather conditions and increased uptake of solar PV (photovoltaic)”.

Chairman Robert Cole, a former Beach Energy boss, noted there had been a massive 25 per cent increase in rooftop solar capacity during the year, with almost 1000MW now installed across the network.

Mr Cole said power provided by solar panels was surging towards 10 per cent of overall output.

“This trend is forecast to continue as customers, facing rising electricity prices, look for cheaper alternatives,” he said.

According to Mr Cole, the growth of big-scale solar plants and wind farms was posing major challenges for Synergy’s fleet of coal and gas-fired generators and the “critical stabilising” role they have usually played in the grid.

On the back of these and other “forces”, he said revenue had fallen 2.3 per cent in 2017-18 to just under $3 billion, despite a 7 per cent increase in household power prices announced as part of the State Budget.

Of greater note was a 10.4 per cent fall in output from Synergy’s generation fleet.

Its production has plunged 20 per cent since 2013-14.

Despite the challenges, Mr Cole noted that tariff increases combined with cost-cutting meant Synergy no longer needed to rely on taxpayer subsidies.

He said the price rise, while unpopular, was “firm and fair”.