There is a lot of misinformation circling around when it comes to solar and the rebates on offer. Essentially, these ‘deals’ make it more affordable to get clean energy systems installed on your property.
You may have read about how these rebates are being cut. While there have been changes made for 2023, they don’t necessarily mean that you are going to pay more for solar installations tomorrow than you would today.
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The first thing to understand is what Small-scale Technology Certificates (STCs) are.
The Small-scale Renewable Energy Scheme creates a financial incentive for individuals and small businesses to install eligible small-scale renewable energy systems. It does this by creating small-scale technology certificates, which Renewable Energy Target liable entities have a legal obligation to buy and surrender to the Clean Energy Regulator on a quarterly basis.
Generally, householders who purchase these systems assign the right to create their certificates to an agent in return for a lower purchase price. The level of this benefit differs across the country depending on the level of solar energy.
Small-scale technology certificates can be created following the installation of an eligible system and are calculated based on the amount of electricity a system produces or replaces (that is, electricity from non-renewable sources).
The number of small-scale technology certificates required to be submitted by electricity retailers is set each year by the small-scale technology percentage (STP).
The short, simplified answer is that these STCs are likely to go down in the near future. That will lead to less money taken off the installation costs for your solar system overall. But that doesn’t necessarily mean that you will pay more.
STCs and rebates you need to know about
The major change lies in what is called the ‘deeming period’, which estimates the assumed lifetime of the solar system you are having installed. Every year until 2030 a year is being dropped off this deeming period which impacts the number of STCs you will receive when you have a new solar system installed.
In 2020, for example, that deeming period was 11 years and in 2021 that has dropped down to 10 years. This means you will be receiving fewer STCs the longer you wait because this deeming period will continue to drop until it is zero in 2030.
While this sounds like a big thing, it is important to consider the cost of a solar power system is also falling every year. The technology is getting better and these panels can be manufactured at much more affordable rates. This trend is likely to continue over the next decade, leading to a drop in the deeming period that will roughly be in line with the decline in solar power pricing.
In saying that, you don’t want to wait until 2030 to install solar panels. The deeming period will be slashed to nothing and we don’t know what the future holds for rebates. It is best to install now with reliable technology and a locked-in deeming period to get maximum bang for your buck. In short, you are guaranteed to get a healthy volume of STCs today, but that may get cloudier as each year goes by. It could – and should – balance out in line with the price of solar system installations, but you are better off grabbing the certainty on offer right now.
Energy Matters has over 17 years of experience in the solar industry and has helped over 40,000 Australian households in their journey to energy independence. Let us discuss and choose the best quote that suits your needs and budget. Use our free solar quote system to get up to 3 free solar quotes from our network of trusted, local installers. Complete our quick quiz and begin your solar journey today!
Updated February 2023
Source: Australian Government – Clean Energy Regulator
