The Solar Credits program is part of Australia’s Renewable Energy Target. Under this initiative, every megawatt hour of qualifying energy generation is eligible for renewable energy certificates (RECs).
These certificates come in two types: large and small. Small-scale technology certificates (STCs) are the ones that apply to residential solar installations.
You might think of an STC as a Federal Government subsidy on the cost of installing your solar system. Depending on how big your system is, and where you live, the number of STCs you are eligible for varies and therefore the amount of your rebate varies.
How does the solar credits scheme work?
A single STC is equivalent to one megawatt hour of electricity generation produced until 2030 (the “deeming period”). STCs are currently issued with qualifying solar power systems and solar panels and can be traded for cash. The value of an STC depends on market conditions.
When you purchase a solar power system from Energy Matters, we have already discounted this value for you in your solar quote. That’s because we take over the hassle of registering and selling the STCs on the market from you. We give you a point of sale discount based on your STCs.
On the day of installation, you assign the STCs over to us and we then complete the registration of these certificates with the Renewable Energy Regulator on your behalf.
The Solar Credits subsidy levels are based on three elements: zoning (where you live), STC values (which fluctuate) and the deeming period. The deeming period decreases by one year every year until 2030. This will reduce the number of certificates that can be created for an eligible system. In 2018 the deeming period was 13 years.
Australia is divided up into various zones based on how much renewable energy can be generated by a solar panel in a given area. It works by postcode. Look up yours in this table and find out which zone you are in.
Once you have your zone note down the ‘rating’ number:
Zone 1 – 1.622 rating
Zone 2 – 1.536 rating
Zone 3 – 1.382 rating
Zone 4 – 1.185 rating
Here’s how you calculate how many STCs you are eligible for:
System size (kW) x Postcode Zone Rating x Deeming Period (years) = Number of STCs (rounded down). Luckily there’s a calculator (see next section) that does the maths for you.
Still with us? Then let’s look at an example to see how you arrive at a dollar figure for your rebate.
Example: How much are my STCs worth?
You can calculate how many STCs you are eligible for using the formula provided above or this handy STC calculator. Feed in the date of installation, size of your system and your postcode and it will give you the number of STCs for which you are eligible.
Here’s an example:
If you buy a 5 kW system in Victoria (Zone 4) the calculator will tell you that you are eligible for 77 STCs. You then multiply this by the dollar value of an STC in the market (your solar installer will be able to tell you the current value). This dollar value fluctuates, but at time of writing it is $36.50* per STC.
Therefore: 77 STCs x $36.50* = $2,810 subsidy.
If you live in a different zone and/or have a bigger/smaller system, the amount of subsidy will obviously vary.
* Estimated value only – values fluctuate due to market conditions.
How much will the subsidy reduce in coming years?
Because the scheme is being terminated, the deeming period will reduce each year. The following graph shows the impact of the shortening deeming period on the Solar Credits subsidy out to 2030, assuming a 5kW installation in Melbourne and an STC value of $38 per certificate.
Can I cash the STC credits myself?
While you can claim the value of the STCs yourself, it means you’ll need to pay the full price of the solar power system up front, then register your STCs on the government exchange and wait in the queue.
However, Energy Matters can offer you a point of sale discount if you assign the credits to us because we are a registered STC selling agent. We then take care of the rest, saving you having to deal with red tape.
Solar Credits Scheme FAQ
The following are some other commonly asked questions and answers regarding the solar credits program.
Is this really a rebate?
The program was previously commonly referred to as the Solar Credits rebate, but in effect it is a subsidy offering up-front discount on the purchase of a solar power system.
Who is the solar panel credits program open to?
Home owners, small businesses and community groups are all eligible for the Australian solar credits program! No one is means tested and schools are also eligible for the Solar Credits scheme.
Does it cover remote power systems?
Yes, the solar credits program covers grid connect and off grid solar power systems. Further details about Solar Credits and off-grid solar power systems can be viewed here.
Does it cover energy storage?
You can buy a battery system as part of a solar package and still receive the subsidy; but energy storage doesn’t attract any extra subsidy.
Can I install the panels myself to get the full solar credits value?
Does the solar credit program also apply to wind power?
Yes it does – the same guidelines will apply for wind turbine installations – even for micro-hydro systems!
What about caravans, boats, sheds, motor homes and RVs?
As long as the caravan, boat, shed or RV is your principle place of residence and has an address (such as a caravan park site or marina berth), it will be eligible under the solar credits scheme.
Contact us today toll free on 133-SUN or email our friendly team for expert, obligation-free advice.