ABOUT THE SOLAR CREDITS SCHEME

The new Solar Credits Scheme replaced the federal government $8,000 solar panel rebate as of June 10, 2009. But what does it mean for you?

What is the Solar Credits Scheme?

Under the previous rebate scheme, the Federal Government provided households with a combined income of less than $100,000 per annum with up to $8,000 to subsidise grid-connected solar power systems of up to 1kW capacity.

The new Solar Credits Scheme, however, is not funded by the government at all. Instead, it is tied to the existing Renewal Energy Certificates (RECs) scheme.

Under the new scheme, each 1 MWh of renewable energy a grid connect system produces will automatically be multiplied by five, so that a solar power system owner can claim five times the number of RECs normally available. (However, you can only claim this for the first 1.5KW of capacity of system, the rest of the system capacity will earn the usual amount of RECs).

So what does that mean for you? Effectively it means that EVERYONE can still get up to $7700 worth of discounts for a 1.5KW system. Great news!

Okay… so what’s a Renewable Energy Certificate?

RECs are essentially tradeable certificates. One certificate is produced as proof whenever a renewable energy resource produces 1 MWh of energy. These certificates can then be sold and traded on the RECs market (which is like the stock market). Who buys them? Well, coal burning power stations are required by the government to purchase a certain number of RECs every year in order to encourage renewable energy production and offset their carbon polluting. If you decide to buy a grid-connect solar power system up to 15 years of your proposed electricity production can be used to create RECs and sold in advance – which means you get the money straight away, so the cost of putting in a system is less.
 

NB: All Solar Credits Scheme information subject to final guidelines.