Will proposed changes to ‘solar zones’ reduce your solar installation rebate?

CER proposes change to federal solar rebate amount

Changes to ‘solar zones’ could affect the federal solar rebate amount that households and businesses receive to support the cost of installing solar panels.

Australia’s Clean Energy Regulator assigns every postcode a solar zone. Your zone’s rating directly affects the rebate amount you receive to install a rooftop solar system.

Now, the Regulator plans to make changes to the solar zones from October 1. It says these reflect changes to Australia Post postcode and electoral boundaries.

federal solar rebate amount

Changes to your solar zone could affect your federal solar installation rebate.

According to the Regulator, the changes are to “best represent the solar radiation for the specified zone”.

“The majority of postcodes changed by this [amendment] will increase in their zone value, but a small number of postcodes will decrease in their zone value.”

How to calculate your solar rebate

The amount you get under the rebate scheme towards your solar installation depends on how many Small-scale Technology Certificates (STCs) you get. This is determined by:

  • The size of your solar system
  • Your solar zone rating (based on your postcode)
  • The number of ‘deeming’ years between now and 2030, when the scheme ends

Let’s take an example: If you buy a 5 kW system in Parramatta, postcode 2150, your current solar zone is Zone 3, which has a rating of 1.382.

The number of years your system will be active during the lifetime of the scheme (which ends 2030) is called the ‘deeming period’ and also figures in the calculation. In 2019, the deeming period is 12 years.

Here’s how to work out the number of STCs you get:

Solar system size (kW) x Zone Rating x Deeming Period (years) = Number of STCs (rounded down).

For our Parramatta example, the rebate would be:

5 x 1.382 x 12 = 82.92 rounded down = 82

The actual value of an STC fluctuates since it’s traded on a market and is subject to laws of supply and demand.

For this example, let’s say the value is $36.75. Remember, this is an example value only, your solar panel installer can tell you the actual value.

In our example, the rebate you get for your Parramatta rooftop solar system is: 82 x $36.75 = $3,029.90

Example of the affect of solar zones change

Let’s say the small town of Solarville finds out its zone will change from 3 to 4. How does this affect the federal solar rebate amount residents can get?

  • Zone 3 rating = 1.382
  • Zone 4 rating = 1.185

For a 5 kW system and a deeming period of 12 years, in Zone 3 the number of STCs is 82. Using our example STC value of $36.75, this equals $3,029.90.

In Zone 4 the same system is worth 71 STCs, or $2,609.25. This would mean a decrease in rebate of $420.65.

Find out if your solar zone will change  

The good news is that under the proposed zone changes Parramatta’s federal solar rebate amount would stay the same.

But you can find out if your solar zone will change under the new zoning. First, check the current zone and rating for your postcode here. Next, check to see if it will change under the proposal by downloading the draft changes here.

If your zone ranking increases, say from 2 to 1, then your rating (and rebate) also increases. The opposite is also true: a decrease in your zone ranking means less of a rebate.

The Clean Energy Regulator is seeking feedback on the proposed changes, particularly impacts to business, community, installers and individuals. You can find the details here.