How do STCs work?
By installing a solar water heater or solar power system on your property, you are most likely still eligible for STCs. These STCs can be used to reduce the purchase price of your new system and can often save you thousands of dollars.
For a Solahart Solar Hot Water system, each STC represents 1 megawatt hour (MWh) of electricity displaced over a 10 year period. For a Solahart Solar Power system, each STC represents 1 megawatt hour (MWh) of renewable electricity produced over 15 years. The number of STC's created varies with the size and model of solar water heater or PV system and the region (or zone) in which the unit is installed. The value of an STC is not fixed and varies depending on market factors.
Once you install a solar water heater or solar power system, the STCs produced can be traded and sold on the open market. You can assign the right to create your STCs to your Solahart dealer who will pay you the value of the STCs as an upfront discount on your system.
To provide a further financial incentive to switch to solar power, some State Governments and electricity providers offer preferential feed-in tariffs. These tariffs allow you to sell any excess electricity you generate back to your electricity provider. Talk to your local Solahart dealer to find out more.
STCs reducing from January 2017
STC financial incentives for solar power systems will not be quite as generous in the future, as a matter of fact, they will start to gradually reduce in January 2017 until they drop out altogether in 2030. Why?
Small-scale Technology Certificates (STC) are currently used to reduce the purchase price of your new Solahart system, and can often save you thousands of dollars. The number of certificates created will vary based on:
- the size and model of solar water heater or PV system you choose
- the location of the installation (or zones)
- the amount of electricity in megawatt hours (MWh) the system will generate over what is known as a deeming period (15 years for PV and 10 Years for Solar Hot Water) or 2030 – whichever comes first:
- For a Solar Hot Water system, each STC represents 1 megawatt hour (MWh) of electricity displaced over a 10 year period or until 2030.
- For Solar Power system, each STC represents 1 megawatt hour (MWh) of renewable electricity produced over 15 years or until 2030.
The STCs produced by the installation of a Solahart system can be traded and sold on the open market, or your local dealer can exchange them at a discounted price of your system to the current value of STCs. This saves you the hassle of dealing with the certificates post-purchase and reduces the initial capital outlay required.
The deeming period for certificates is 15 years or 2030, whichever occurs first, this means that from January 2017, the deeming period will be reduced to 14 years. In 2018 it will reduce to 13, and the following year it will reduce again – and so on until we reach 2030.
For example, a 5kW Solahart solar power system installed in Canberra (Zone 3) is currently entitled to 105 certificates. If the current rate of STCs was $37 per STC, meaning that until 1 January 2017 the cost of the purchase of the system is reduced by $3,885 – which is a great incentive.
After 1 January 2017 this amount will reduce to $3,626 (i.e. reduced by one fifteenth)
Going solar is a decision that perhaps shouldn’t be left until last moment also considering that STC’s value may also change in the future.
Solahart Solar Water Heaters
The deeming period for certificates is 10 years or 2030, whichever occurs first.
This means customers wanting to purchase either solar water heaters or heat pumps can still get full STC incentives until 2022.