STC Prices And Australia’s Solar Rebate: Update

STC spot prices have remained pretty strong so far this year, making it a great time to go solar – find out why.

Australia’s hugely popular “solar rebate” is almost always accessed as an up-front discount rather than something you have to apply for after forking out the full system cost. Generally speaking, the prices you see advertised for systems include that up-front discount.

The subsidy is based on Small-scale Technology Certificates – or STCs for short. These bits of virtual paper can only be created after a system is installed. When you buy a solar power system, you agree to sign over the rights to them to get the discount and the installation company will claim the STCs post-installation.

The number of STCs accompanying a system depends on three elements:

• The system size in terms of solar panel capacity¹
• The year of installation
• The geographical location of the installation

The value of an STC fluctuates with market conditions. There is a ceiling on value ($40), but no floor; so they can theoretically drop to $0. That has never happened, but there was a period some years ago when they dropped to $26.

STC Spot Prices In 2021

The following graph sourced from DemandManager (and butchered by me) shows that this year STC spot prices (in blue) kicked off around the $38 mark and generally stayed above that level to this point; currently around $38.70. These are good prices in terms of supporting high solar rebate values.

For example, a eligible 6.6kW system installed in Sydney at the moment would be entitled to 91 STCs and attract a rebate value of around $3,500².

What would happen if STC spot prices dropped to that low of $26 mentioned? In that scenario, the rebate would be worth approximately $2,366. A difference of more than $1,100 could make the difference between many households being able to afford to install a solar system and not.

So, what are the chances of STC spot prices plummeting? I have no idea, but over the last 12 months the spot price doesn’t appear to have dropped below $37.20. At $37.20, the rebate value for a 6.6kW system would be around $3,385.

At the maximum value of $40, the rebate would be $3,640.

But if the last 12 months or so has taught us anything, it’s to expect the unexpected and holding out for potentially $140 maximum more may not turn out to be the best move. Also bear in mind the longer you put off installing solar panels, the longer you’re being locked into electricity bills much higher than they would be with solar energy.

If you’d like to see the impact of changes in values and what sort of rebate you can expect in your part of Australia, try the SolarQuotes STC calculator, it’s super-easy to use.

Original Source: https://www.solarquotes.com.au/blog/stc-prices-rebate-mb1996/