Hot water systems buying guide

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05.Incentives for solar

If you install a new solar or heat pump system, you’ll probably be eligible to receive Small-scale Technology Certificates (STCs) which replace the old renewable energy certificate (REC) system. These were developed by the Commonwealth Government to encourage the reduction of greenhouse emissions from the use of electricity.

The STC scheme works by requiring electricity retailers to contribute towards meeting renewable energy targets - an obligation they can meet by purchasing STCs.

So when you install an eligible system, you’ll be rewarded with a certain number of STCs based on how much greenhouse gas it saves and where you live, as this affects the system's efficiency.

You then either register your STCs and sell them to an energy retailer, or you assign them to an agent (often the supplier of the your hot water system) who will register and sell them for you. The second option is the most common as it's more convenient for the consumer; when you buy a solar or heat pump hot water system, the supplier offers an up-front discount in exchange for the STCs - usually this amounts to several hundred dollars off the price.

STC prices can vary but are typically in the range of $15 to $40 per certificate. Their value may vary depending on supply and demand. The small print of the STC scheme is fairly complicated, so consult your retailer or check the Office of the Renewable Energy Regulator (ORER) for more information on how it works. The ORER site has calculators to help you estimate how many STCs a given system will be eligible for, and a guide to approximate STC prices.

Government rebates can apply when you install a solar or heat pump hot water system. Not all households will be eligible. For more information on rebates and other incentives, go to the Federal Government's Living Greener website, or contact your state government energy authority.


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