SOLAR-CREDITS / STC's

Solar credits replaces rebates; the federal government stopped paying rebates in June 2009.

Link to the federal government website for further details about the scheme.

Fundamentally, Solar Credits work a bit like selling shares. When your solar system is commissioned and able to produce electricity the credits are created; as the owner of the credits you can choose to sell them to offset your capital cost of installing the system. The liable parties that purchase the STC's are coal, gas & diesel power stations.

The base unit STC - Small-scale Technology Credits (formerly REC's - Renewable energy Credits) are calculated according to the system capacity and location (e.g. the same capacity system installed in Adelaide will yield more energy than in Mt Gambier and therefore attracts more credits).

For Grid connect systems the Solar Credits are simply STC's with a multiplier linked to the first 1.5kWp capacity being installed. For example if you installed a 2.5kWp system in Adelaide, it would attract 51 standard STC's, however using the current solar Credit multiplier (3x) the same system attracts 114. Remember the multiplier is applied to the first 1.5kWp only, remaining STC's are calculated at 1:1.

For Off-grid systems, the multiplier is applied to the entire capacity (up to 20kW), providing greater offset to installation costs. Eg: a 2.5kW off-grid system attracts 153 credits.

The exact value of your credits is determined by the market price of the STC's (supply and demand based) and can vary from time to time. During 2011 the STC market price fell sharply due to the huge quantity of solar systems being installed. Spot prices fell as low as $17 per credit in June 2011; since the start of 2012 the market has regained much of the lost value and is around $28-$31.

There are a number of ways you can trade your STC's, most companies neglect to make you aware of your options and only offer a discount.

The credits are yours and you are entitled to know the options available to you.....

1. Receive a discount off the price of your solar system based on the current market spot price of the STC's. this options is the easiest, however the market price can be quite volatile at times and knowing your exact out-of-pocket expense is difficult. If the market price is high at time of installation - great, you can write us a smaller cheque. However if the market price has fallen you will need to write a larger cheque to make up the shortfall. It is worth knowing also, it is irrelevant what the market price is when you order a system, the price at time of installation is what counts.
   We are acting as an intermediary between you and a broker, they will reimburse us for the amount we have given you as a discount.
2. Sell the STC's to a broker. This option gives you more control and is particularly good if the market prices at time of installation is low. Initially you pay in full for your system when it is commissioned, you then hold onto the credits until the market price is more favorable and sell them then. We help you to trade the credits by handling the initial paperwork for you. Once your bank details are on the form you just submit it to the broker when ready. Payment usually arrives within 4 weeks.
3. Sell via ORER (Office of Renewable Energy Regulator) Clearing House. This option became available in January 2011 and gives you the ability to sell direct to the wholesale buyers, bypassing brokerage margins. The ORER guarantees a fixed price of $40 per STC, however you need to be prepared to wait at least 4 months before your credits are traded. We will provide the necessary paperwork to enable trading, however you will need to complete the process on line. As with option 2, payment for your system is required in full upon commissioning.

If you have received a rebate previously at your address for solar power, you can only earn standard one-for-one STC's for systems for additional panels installed.

Solar credits are available to any person or entity that installs renewable energy equipment.

Warning: Some solar companies are offering misleading information about the value of their systems and Solar Credits. I saw one recently where the quoted price was inflated about $10,000 above genuine price, with a fixed discount of $40 (market price is actually $28 at time of writing), the quote also offered an amazing $5000 discount on top: the net result was massive discounts, still to arrive about $2000 above real market value - the unsuspecting customer will get sucked in by the huge savings that were never really there. BUYER BEWARE!