An announcement of a further reduction to the Solar Credits rebate didn’t eventuate in Budget 2012 as some suspected might happen. Does this mean the rebate is totally safe?
The Solar Credits rebate is based on a Renewable Energy Certificate (REC) multiplier system. Currently the multiplier is set at three, with it dropping to two* on July 1. While commonly referred to as being a “rebate”, it is actually an up-front discount on the purchase of a solar power system.
After the details of Budget 2012 were announced, a question from a reader was posted on our related article asking:
“If they were going to drop the solar multiplier from 3 to 1 instead of 2 as planned would that have been announced last night? Or could that still happen?”
The Clean Energy Council recently posed a number of questions to Australia’s Clean Energy Regulator regarding the upcoming scheduled reduction. Among them:
CEC: Is the Minister required to give notice of 90 days if he wishes to reduce the multiplier from 3 to less than 2 from 1 July 2012?
Clean Energy Regulator response: No.
CEC: If the multiplier were to be reduced from 3 to less than 2 would that require a change to legislation or could this be affected through regulation?
Clean Energy Regulator response: It could be affected through regulations. But it is very unlikely that the multiplier will be cut lower than the scheduled reduction from 3 to 2.
While the Solar Credits rebate isn’t 100% safe from surprise reductions; all indications at this point are that this will not occur. After the July 1 drop, the next scheduled – and final – reduction is on July 1, 2013 when the multiplier aspect will be removed altogether.
* In order to benefit from the current 3x Solar Credits rebate multiplier, systems must be installed by June 30. However, national solar provider Energy Matters is currently running a guarantee offer locking in the price of selected solar power systems; regardless of whether installation occurs before or after June 30. A 10% deposit secures a system under the arrangement.
