Feed-in Tariffs Explained

As the Federal government provides incentives via the solar credits scheme, there isn’t any national buyback scheme for electricity generated from solar electricity system. Some State governments have designed feedin tariffs (FiTs) to support to get in solar energy, and homeowners like you the schemes change from state to state.

 

Essentially a feed-in tariff is an incentive so that once your solar electricity system starts creating electricity, your electricity retailer pays a superior price to you for some or all the electricity created. In Australia there are two kinds of feed-in tariff apparatus, and they count on where you live:

 

You’re then charged at the ordinary rate for the energy use. This tariff was available in the NSW and ACT, but both schemes have now closed.

 

Net feed-in tariff — pays you just for the excessive power you generate in addition to the electricity you used in your house.

 

Many of our clients are now finding their solar investment making a favorable net yield *, where in fact the tariffs are greater than the cost you pay for electricity from your electricity retailer. ie. Not only will you lower your power bills but you could even produce some income from your solar investment.

 

Solar Credits

Solar Credits is a mechanism which increases the number of small-scale technology certificates (STCs) able to be created for eligible installations of small-scale solar panel, wind and hydro systems.

Information

What are Solar Credits?

  • Solar Credits multiplies the number of STCs the system is eligible for.
  • Solar Credits applies to the first 1.5kW of a system and certain criteria must be met to be eligible.
  • The current Solar Credits multiplier is as follows.

 

Installation Period Multiplier
1 July 2010 – 30 June 2011 5 x [number of eligible STCs]
1 July 2011 – 30 June 2012 3 x [number of eligible STCs] *
1 July 2012 – 31 December 2012 2 x [number of eligible STCs]
1 January 2013 – onwards 1 x [number of eligible STCs] **
(ie no multiplier
)

* unless contracts made on the basis of a multiplier of 4 were entered into prior to 5 May 2011, in which case the multiplier of four (4) may apply. See Transitional Arrangements for more detail.
** unless contracts made on the basis of a multiplier of 2 were entered into prior to 16 November 2012, in which case the multiplier of two (2) may apply. See Transitional Arrangements for more detail.

  • Solar Credits are not means tested.
  • Solar Credits apply to the first 1.5 kilowatts (kW) of capacity installed at an eligible premises (see below) OR to the first 20kW of capacity for an eligible off-grid system.
  • Generation from capacity above 1.5 kW or 20kW (for eligible off-grid systems), will still be eligible for the standard 1:1 rate of STC creation.
  • Solar Credits apply to all SGUs, including solar, wind, and hydro installations.

If you are installing an eligible off-grid small-scale system, it may be eligible for Solar Credits over and above those applicable to grid-connected systems.

 

Eligibility criteria for Solar Credits
Transitional arrangements for receiving the 2x Solar Credits multiplier
Transitional arrangements for receiving the 4x Solar Credits multiplier
Installing additional capacity
Eligible premises

Solar Credits can only be claimed for one small-scale solar panel, wind or hydro system installed at each “eligible premises”. “Eligible premises” is defined in the Regulations to mean any of the following:

 

  • a house (including the land on which the house is located and any outbuildings on the land)
  • a townhouse
  • a residential apartment
  • a shop (including the land on which the shop is located and any outbuildings on the land)
  • other premises located at an address

 

An Outbuilding is a detached building subordinate to a main building and is not considered to be an eligible premises in its own right.

 

  • If a building is not an eligible premises under the following definitions, any small-scale solar panel, wind or hydro system installed on that building is still eligible to generate standard STCs.

 

House

A house is an eligible premises. However, the following separate buildings are not eligible:

 

  • a home office located in the house or in an outbuilding on the land where the house is located; or
  • a business operated from the house or in an outbuilding on the land where the house is located;

 

Townhouse, residential apartment

A townhouse, residential flat, unit or apartment is eligible to claim STCs on an installed small-scale solar panel, wind or hydro system. This includes townhouses or apartments located in a:

 

  • multi-story apartment building; or
  • retirement village.

 

It does not include a room in a nursing home, hostel or similar assisted living facility. It also does not include:

  • a home office located in the townhouse, residential flat, unit or apartment; or
  • a business operated from the townhouse, residential flat, unit or apartment;

 

Shop

A shop is an eligible premises (except when located in a house, townhouse, residential flat, unit or apartment that is itself an eligible premises – see above). Each shop in a shopping mall or other multi-shop type complex is an eligible premises.

 

Other premises located at an address

Business premises (eg factories and offices)

 

Each separate business which is located at an address will be a “premises located at an address”, except when located in a house (land or outbuilding), townhouse, residential flat, unit or apartment that is itself an eligible premises.

 

Some businesses may be located at an address which covers several numbers in a street (e.g. a factory might be at 42-56 Smith Street). In such a situation, there is only one eligible premises.

 

Alternatively, some businesses will occupy a separate unit at a single street address, where a different business is carried out in the separate units, (e.g. Unit 2 of 56 Smith Street). Each unit is a separate eligible premises.

 

Specific types of premises

 

Each of the following types of businesses are regarded as a single eligible premises:

 

  • a motel, hotel, resort or caravan park. However, individual room/cabin/villas etc in a motel, hotel or resort and each stationary caravan in a caravan park are not separate eligible premises.
  • a nursing home, hostel. Individual rooms in the home or hostel are not a separate eligible premises.
  • a hospital
  • a restaurant

 

Community and educational buildings

 

  • The building(s) located at an address where a community group or institution carries out its activities (including the land on which the building is located and any outbuildings on the land) is a single eligible premises (eg a scout hall, guides hall, sporting club, school, church or other religious building).
  • In the situation where the building(s) is or are used by more than one organisation, there is one eligible premises only.

 

More than one premises located at a single address

Where more than one separate premises (excluding outbuildings) is located at a single address, all of those premises are separate eligible premises. Examples might include a:

 

  • dairy on a farm that is separate to the residential house on the same farm — both premises are eligible premises;
  • owner/manager’s house that is separate to the rest of a caravan park but at the same address — the house is a separate eligible premises to the caravan park;
  • green keeper’s house that is separate to the rest of the golf course at the same address — the house and the business premises are separate eligible premises.

 

To be another ‘eligible premises’ at a single address, the premises must be clearly separate from the other eligible premises located at the address (e.g. the house). A building is not an eligible premises if it is an outbuilding associated with a house. For example:

 

  • a garage, studio or other small building situated in close proximity to a house which itself is an eligible premises (where a small business may be carried out) is as an outbuilding and not another eligible premises;
  • a larger business premises that is not subordinate to a house which itself is an eligible premises, and which more commonly is located further from the house than is usual for a garage or studio, is not an outbuilding and therefore is a separate eligible premises.

 

If you apply for Solar Credits for multiple systems at a single address you must provide evidence of their eligibility for Solar Credits to the Clean Energy Regulator by emailing as much detail as possible including:

 

  • Location,
  • address,
  • boundaries,
  • road access,
  • title information,
  • access to electrical connection and metering,
  • ownership,
  • occupancy,
  • nature of business,
  • ABN
  • maps
  • and other information you may wish to provide.

 

When the above details have been sent to the Clean Energy Regulator via email you must put a note in the special address field that states the date the email was sent and a description that matches the content that was sent via email.
The Clean Energy Regulator can only validate multiple Solar Credits at a single address when sufficient evidence of separate eligible premises have been provided.

 

Structures that are not eligible premises

The following structures are NOT eligible premises:

 

  • street lights, street signs, mobile phone towers, sheds, boats, cars and trailers;
  • mobile homes, caravans or similar wheeled vehicles not intended to be permanently attached to the land (these are not defined as eligible premises because they do not remain at a location for a long period of time).

 

If you would like clarification regarding the eligibility of a particular premises, please contact the Small Units Team at the Clean Energy Regulator via email retscheme@cleanenergyregulator.gov.au. Include in your email as much detail as possible including location, address, boundaries, road access, title information, access to electrical connection and metering, ownership, occupancy, nature of business, maps and other information you may wish to provide.