What are Solar Credits?

The Australian Government is supporting the deployment of renewable
energy in Australia’s electricity supply through the Renewable Energy Target
(RET) scheme. The RET guarantees a market for additional renewable
energy generation, using a mechanism of tradeable renewable energy
certificates.

Solar Credits is a mechanism within the RET scheme that provides additional
support to households, businesses and community groups that install smallscale
solar PV, wind and hydro electricity systems by multiplying the number
of RECs able to be created for eligible installations.

More information on Solar Credits for small generation units fact sheet.

The RET scheme operates as two separate parts:

• the Large-scale Renewable Energy Target (LRET), which supports the
  deployment of renewable energy projects like wind farms, and
  commercial solar and geothermal power stations; and
• the Small-scale Renewable Energy Scheme (SRES), which provides
  support for installations of small renewable energy systems such as
  rooftop solar panels and solar water heaters.

Solar Credits is a mechanism within the SRES scheme that provides
additional support to households, businesses and community groups that
install small-scale solar photovoltaics (PV or solar panels), wind and hydro
electricity systems by multiplying the number of small-scale technology
certificates (STCs) able to be created for eligible installations.

The Solar Credits multiplier reduces over time, reflecting reductions in
technology costs.

More information on Solar Credits is available in the fact sheet.

Iʼm planning on getting a solar PV system installed on my home. How do I get Solar Credits?

Solar Credits are provided in the form of additional tradeable certificates
called small-scale technology certificates or STCs for eligible small-scale
solar PV, wind and hydro electricity systems.

While system owners can create and sell the certificates themselves, in
practice, providers of solar PV systems usually offer a discount on the price of
a solar PV system, or a cash payment, in return for the right to create and sell
the Solar Credits. Households considering installing solar PV systems are
encouraged to shop around for the best deal on their solar PV system.

Detailed information on eligibility and processes for accessing Solar Credits is
available on the website of the Office of the Renewable Energy Regulator
(ORER), who administers Solar Credits.

What changes are being made to Solar Credits?

On 5 May 2011, the Government announced that the Solar Credits multiplier
will be reduced to three for small-scale systems installed from 1 July 2011.
The multiplier will then phase down by one each year consistent with the
original intent of the Solar Credits multiplier reducing over time, until the
multiplier is phased out by 1 July 2013.

Solar Credits is expected to still provide a substantial level of support to
assist with the cost of installing solar panels and other small generation units.
See below for more information on the benefits.

How will these changes affect current and future installations?

Changes to the multiplier will not affect any other aspect of the way Solar
Credits operates. Current installations will not be affected by the changes,
and installations up to 30 June 2011 will continue to receive Solar Credits with
a multiplier of five.

For systems installed from 1 July 2011 to 30 June 2012, the multiplier will be
three, and will reduce by one each financial year until the standard rate of
STC creation (a multiplier of one) applies for systems installed from
1 July 2013.

The Government intends to put in place transitional arrangements in
regulations to recognise written contracts entered into prior to 5 May 2011, for
system installation from 1 July 2011 to 30 June 2012, where the contract was
made on the basis of the previous multiplier of four, but only where a number
of conditions have been met.

It is the Governmentʼs intention that regulations to give effect to the reduction
in Solar Credits multiplier, including the transitional arrangements, will be
made prior to the end of June 2011.

It is anticipated that the transitional arrangements would specify that, as a
minimum, for a person to be entitled to create small-scale technology
certificates (STCs) for the small generation unit (SGU) such as a rooftop solar
photovoltaic (PV) system under the proposed transitional arrangements, he
or she must:

• ensure the system complies with all existing Solar Credits eligibility
  criteria;
• possess a copy of the written contract executed before 5 May 2011
  made on the basis of the previous multiplier of four for the installation of the system, which would include as a minimum the:
  •   name and address of the supplier;
  • address at which the system was installed
  • name of system owner; and
  • brand, model number and total capacity of the solar photovoltaic
    panels and the inverter to be installed;
• possess documentary evidence that a monetary deposit had been paid
  by the owner of the system prior to 5 May 2011; and
• provide a signed Statutory Declaration to the Office of the Renewable
  Energy Regulator, stating that he or she has the required evidentiary
  documentation in their possession and will maintain these records in
  accordance with relevant provisions in the RET legislation.

Where a person is seeking to make an application to create STCs for a
number of different installations under these transitional arrangements at one
time, only one Statutory Declaration will be required, but the Declaration must
clearly identify all installations relevant to the application.

The Office of the Renewable Energy Regulator undertakes investigative
audits based on a risk management approach to verify applicants have met
specified requirements for creation of STCs.

How much benefit can I expect to get from Solar Credits for installing a solar PV system?

Solar Credits are provided in the form of STCs, for people who have installed
a new and eligible solar PV system (or other small generation unit). The Solar
Credits multiplier applies to the first 1.5 kilowatts (kW) of capacity of the
system installed for systems connected to a main electricity grid and up to the
first 20 kW of capacity for off-grid systems.

The level of support provided by Solar Credits depends on the location and
size of the system and the price of STCs. The STCs are able to be traded at
$40 through a voluntary clearing house established by the ORER under the
new Small -scale Renewable Energy Scheme. Alternatively they can be sold
on the STC market, usually for a lower price.

Households considering installing solar PV systems are encouraged to shop
around for the best deal on their solar PV system.

A table outlining examples of the support under Solar Credits for a typical
installation is provided in the fact sheet: [link to the Solar Credits fact sheet
PDF]

Why do Solar Credits vary across the country?

The number of Solar Credits created for a system will depend on the amount
of renewable energy the system generates. For practical purposes in
allocating certificates for small-scale system installations, four separate solar
zones have been identified. For the purpose of allocating Solar Credits all
installations in a zone are taken to receive the same amount of renewable
energy. For example:

• A solar PV system in Zone 3 for which includes Sydney, Perth,
  Adelaide, Brisbane and Canberra will create the same number of STCs
  and potentially receive a similar level of support.
• The same sized system installed in Zone 4 which includes Melbourne
  or Hobart will receive fewer STCs as these areas have less sunshine so
  less renewable energy is produced.

What if I want to apply for Solar Credits myself?

Generally when installing solar PV systems, owners transfer the right to
create STCs to their solar panel supplier in return for a discount on the price
of the system being installed. In this case households considering installing
solar PV systems are encouraged to shop around for the best deal on their
solar PV system.

Owners of eligibly installed solar PV systems can also access Solar Credits .
Owners can do this directly or through an agent by applying to the Office of
the Renewable Energy Regulator (ORER) any time within 12 months
following the date of installation.

Further information on accessing Solar Credits directly is available from
ORER.

How do I find out whether my system is eligible for Solar Credits?

The eligibility rules are prescribed in the RET scheme regulations,
administered by the Office of the Renewable Energy Regulator (ORER).
Key rules are summarised below. Details of the rules are available on the
ORER website

• The system must be an eligible ʻsmall generation unitʼ; being a solar PV
  system of up to 100 kilowatts (kW) capacity; a small wind turbine of up
  to 10kW capacity or a micro-hydro system of up to 6.4 kW capacity.
• The system must be installed at an eligible premises. Examples include
  houses, townhouses, residential apartments and shops.
• The system must be a new and complete unit.
• A premises receiving a grant or rebate under the Solar Homes and
  Communities Plan, the Renewable Remote Power Generation Program
  (RRPGP), or the National Solar Schools Program (NSSP) is not entitled
  to Solar Credits.
• No more than one system at an eligible premises (address) is entitled to
  Solar Credits.
• Solar Credits may only be created once for a particular installation,
  irrespective of whether the certificates are created for a 1-year, 5-year
  or 15 year deeming period.
  The system must have been installed no more than 12 months prior to
  the date of application for Solar Credits.