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What is the Australian Government solar rebate?

What is the Australian Government solar rebate?

If you buy a solar panel system for your home or business, it will be subsidised through a federal government solar rebate scheme which reduces the upfront cost of your solar system by around 30 per cent.

This government scheme works by issuing Small-scale Technology Certificates, or STCs.  In effect, STCs work as a point-of-sale discount on your solar panel system.  Strictly speaking they aren’t a solar rebate, but to all intents and purposes they act in much the same way.

The main thing to know is – when it comes to government solar rebates and incentives – STCs are where it’s at. They are best solar rebates that homeowners and small businesses can get for installing solar panels; that’s because they’re worth the most!

On this blog:

  • Am I eligible for STCs?
  • How do I apply for STCs?
  • How much are STCs worth?
  • How are STCs calculated?
  • Is there any chance STCs will reduce in value?
  • How can I get the highest value for STCs for my solar system?
  • What other solar rebates and incentives are there?

Am I eligible for STCs?

The great thing about STCs is they aren’t means tested.  The only criteria for claiming STCs are:

  • Your solar panels system must be connected to the main electricity grid
  • Your system is less than 100kW in size
  • It is installed by a Clean Energy Council accredited solar installer
  • It uses a solar inverter and solar panels that have been accredited by the Clean Energy Council

Another great thing about STCs is that you can get them on more than one property. So, if you own a couple of properties and want to get solar panels installed on both with the STC rebate, that’s not a problem.  Also, proof of property ownership is NOT required to get STCs which is another bonus, for example if you are a commercial tenant looking to install solar.

How do I apply for STCs?

Here’s more good news!  You don’t need to fill in any complicated paperwork to claim STCs. All you need to do is sign a form on day of installation – which your installer will give you – which assigns the STCs for your solar system to your Solar Retailer.

Your Solar Retailer will provide you with a quote which clearly shows the number of STCs your solar system qualifies for, and the price per STC.  This amount is deducted from your upfront purchase price.

Once you’ve signed the form assigning the STCs to your Solar Retailer, they will batch them up with other STCs and then trade them on the STC market (which is like a share market for renewable energy certificates). This saves you the time and hassle of trading STCs yourself.

How much are STCs worth?

At the time of writing (April 2022), STCs are worth approximately $447 per kilowatt of solar panels installed.

For example, if you installed 6.6kW of solar panels, you’d get around $2,950 off the purchase price of your solar power system.  And if you installed 10kW of solar panels, you’d get around $4,470 off the purchase price.

These are just averages.  If you live in Queensland or NSW, for example, you’d get a bigger STC rebate – up to $3,450 for a 6.6kW solar system.  And if you lived in Tassie, you’d get a bit less.

One of the main points to be aware of is that the more solar panels you install, the bigger the STC rebate!

The bigger your solar system, the more STCs you get

STC discount per kilowatt of solar panels6.6kW10kW13kW

How are STCs calculated?

There are four main factors that impact on how the value of STCs are calculated:

  1. Kilowatts of solar panels installed
  2. Market value
  3. Date of installation
  4. Your location

Let’s look at each in turn.

Kilowatts of solar panels

The first thing to understand is that STCs are calculated based on the kilowatts of solar panels installed, not the capacity of the solar inverter.  For example, if you installed a 10kW solar inverter with 13.3kW of solar panels, the STCs would be calculated on the 13.3kW of solar panels – not the 10kW solar inverter.

This is one of (the many) advantages of oversizing your solar panels in relation to the solar inverter size – and it is allowed by network distributors who set the rules for these things!

Market price

As previously mentioned, STCs are a tradeable commodity.  As such, their value is subject to supply and demand. The greater the supply of STCs, the lower the price. The fewer STCs, the higher the price.

The federal government has set the rule that the value per STCs cannot be lower than $0 and no higher than $40.  Currently (as of April 2022), the value is $36. However, several years ago the value dropped to $17 when the market was flooded with STCs.

As with any market, there’s no guarantee what prices will do.  Right now, STC prices are strong, but this could change at any time.  That’s why acting now and getting a solar panel system installed is a good idea as a drop in the market value of STCs could reduce the value of this solar rebate significantly.

Date of installation

Another factor affecting the value of STCs, is the date your solar system is installed.

Every year on the 1st of January, the value of the STC discount drops; that’s because of something called a ‘deeming period’.

The deeming period is the number of years left for the STC scheme to run.  STCs will be phased out completely by 2030.  The reduction in the deeming period effectively reduces the value of the STC rebate you can get for your system.  This reduction is typically around 5 per cent a year.

This is another reason why it’s worth acting now to get your solar panel system installed.

Your location

The number of STCs you get also depends on where your property is in Australia.

The federal government has divided Australia into four zones based on the amount of sunshine each region gets (the sunnier parts of Australia generate more renewable energy from solar panels, so that’s why they get more STCs).

Zone 1 gets the most STCs (and the highest STC rebate), and Zone 4 gets the least STCs.

Australian map STCs
Australian map STCs

Is there any chance that STCs will reduce in value?

Yes, there is every chance that the value of STCs will drop in value.

We know for a fact that on the 1st of January each year, there will be a reduction in the value of STCs based on the reduction in the deeming period (that’s because the STC scheme is slowly being phased out).

Another factor that cannot be predicted with any certainty is whether the tradeable value of STCs will change.  This all depends on whether the number of solar installations under 100kW stays steady, reduces, or booms!

Predicting the market value of STCs is pretty much impossible.  That’s because solar uptake can be enormously impacted by changes in government policy, both at federal and state-level.

How can I get the highest value for STCs for my solar system?

The best way to lock in the highest value for STCs for your solar panels system is to request a quote today.  That way, you stand the best possible chance of getting the best discount off your solar panel system whilst STCs are at their current high value.

What other solar rebates and incentives are there?

Other solar rebates and incentives for installing solar panels include:

  • State government solar rebates
  • State government interest-free loans
  • Tax incentives (e.g., for landlords installing solar on rental properties, business tax incentives)
  • Industry-specific solar rebates for business
  • Solar feed-in tariff (which isn’t a rebate but provides ongoing revenue over the life of the system)

These rebates and incentives are in addition to the federal government’s STC program.

Get in touch

If you’d like to know what solar rebates you could get, contact us today.

As one of Australia’s top Solar Retailers, we’re fully across all the state and federal rebates that are available for solar power systems of any size.

Regardless of whether you want solar for your home or business, we can let you know which rebates you can apply for– and help you with the application process if required.

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