The STC support from the Small-scale Renewable Energy Scheme is set to decrease from Jan 1 2020, which will effectively increase the cost of solar installations in Australia.
This scheme gives householders and businesses small-scale technology certificates (STCs) for installing systems and the size of these systems determines how many STCs are awarded. STCs have monetary value and this value is discounted from the installations’ upfront costs. For larger installations, STCs can mean a discount of thousands of dollars.
The Small-scale Renewable Energy Scheme is set to be phased out
Energy minister Angus Taylor has said that this scheme will be phased out over the next 12 years with no more STCs to be issued at all after 2030. It’s this scheme, however, that has helped to drive the increasing uptake of solar in the country.
How to STCs change the cost of rooftop installations?
The number of STCs per installations will be reduced year by year.
For example, a 5.3kW system installed in Darwin will receive 97 STCs up until January 1 2020. If a similarly-sized system is installed during 2020, it’ll get 89 STCs and in 2029 there’ll be just 16 STCs.
All those STCs have a market value, which can vary according to supply and demand, but this value tends to hover at around $35. If you look at the current number of STCs – 97 – and multiply this by $35, the discount from the cost of the installation is $3,395.
In 2025, however, the discount will be down to $1,960 and this discount will reduce until it reaches zero during 2030. In short, the sooner you install your system, the cheaper you’ll find it. Each region has its own allowances for STCs, so check yours out here.
You may still qualify for some assistance
Some states offer financial assistance in the form of rebates for eligible households to make their installations more affordable. Some states will be reducing the amount of these rebates in 2020, however, so head to your state government website to find out more.