Mark from MC Electrical in Brisbane explains the details of the STC rebate for solar systems. He discusses how the rebate is calculated based on factors like installation year, location, and system size, emphasizing that it gradually reduces each year. Mark clarifies that the dodgy ads about the rebate ending on December 31st are misleading, as the reduction is gradual. He also explains the process of claiming the rebate, highlighting that installers handle the paperwork. The STC rebate is funded by companies mandated under Australia’s Renewable Energy target to buy STCs. Mark also touches on the Feed-in Tariff, which he plans to explain further in the video.
Video Transcript
If you are looking into buying solar, you’re probably wondering if there is still a solar rebate and, if so, how much it is worth. Well, there are two rebates. The first rebate is called STCs, it’s worth thousands of dollars depending on the solar system that you buy, and I’ll cover that in this video. The other “rebate” I guess you could call it is the ‘Feed-in Tariff’. The feed-in tariff is terribly misunderstood, but it is also worth many thousands of dollars over the life of the solar system. So, at the end of the video, I’ll explain why so many people get the ‘feed-in tariff’ so wrong.
But, first I’m going to tell you how many thousands of dollars the STC rebate will save you, I’ll also tell you who pays for it, how you can claim it, and when this solar rebate actually ends.
I’m Mark from MC Electrical in Brisbane and this is part of my “Before You Buy Solar” Series designed to give simple answers to simple questions for those who are looking into solar.
The STC rebate is simply a government-designed incentive to encourage customers to buy solar. As a ballpark in Brisbane, STCs are worth around about $400 per kW in 2023. So, if you get a 10kW solar system, it’s about $4000. Each calendar year, this solar rebate reduces by about $50 per kW. So, in 2024, that $4000 rebate on a 10kW system will be about $3500. I say “about” because the value goes up and down like the share markets. I’ll get to that in a minute.
So, when you hear those dodgy ads on TV saying, “Get in quick before the rebate ends on December 31st”, you now know that they are lying to you. In reality, if your system is not installed before the first of January, you will miss out on around about $50 per kW of panels that you install. Now you know that the STC rebate is gradually reducing each calendar year. In 2030, the last year of the STC scheme, the rebate will only be worth about $500 for a 10kW system. So you probably want to get in before that.
But just really quickly, this is how the value of the STC rebate is calculated. Your solar system will be assigned a number of STCs based on the amount of clean energy the system is estimated to produce between now and 2030. The three main factors in the calculation are the year it was installed, the location, and the size of your solar system, based on the panel size, not on the inverter size.
For example, 10kW of solar panels in Brisbane in 2023 will get 110 STCs. The same 10kW system in Hobart will get you 94 STCs, and up in sunny Darwin, it will get you 122 STCs.
But how much are 110 STCs worth? Well, the value of STCs is variable. That price goes up and down depending on supply and demand. In recent years, the value of just 1 STC varied from about $27 to a high of $39 per STC. Actually, the theoretical maximum is $40 per STC, but you’ll never get that.
So let’s say the price of STCs when we trade them in is $37. Well, 110 STCs times $37 is $4070. So you’ll save $4070 on the cost of a 10kW solar system.
So how do you claim this rebate? Here’s the good news. You don’t have to do anything except install your solar and sign your name. Your installer will process all the paperwork and claim it on your behalf.
The bad news is that if you’ve already received a quote for solar, the STC rebate is most likely taken into account as a point-of-sale discount.
So, in 2023, if you see an 10kW system advertised for $12,000. The quote for that system will actually be for $16,000 minus a $4,000 STC point of sale discount, so the payment that you’ll owe is $12,000.
After we have installed your solar, we’ll just ask you to sign a form saying that we installed a solar system at your home. We then do the paperwork and claim the rebate on your behalf.
Ok, let’s talk about where all this money is coming from. Is it taxpayer money? Well, no, it’s not.
I’ve been calling it a STC rebate, but it’s not actually a rebate. STC stands for small-scale technology certificates or STCs. And it’s not paid for by the government, but by companies that buy and sell wholesale electricity, you know like AGL and Origin, and also by companies that use bucketloads of energy in manufacturing.
Under Australia’s Renewable Energy target, these companies must buy a certain amount of STCs each year to atone for their coal-burning sins. It’s effectively government-mandated environmental Robin Hoodery. Take money from the rich environmental destroyers and give it to you, the renewable energy warrior.
Ok, now that we have the STC rebates sorted, you’ll want to know about the hugely misunderstood Solar Feed-in Tariff. And it’s all good news.
