Think of it as the money the Federal government pays you to install a solar electricity system! The Solar Credits scheme has been introduced by the Federal Government as part of the revised RET (Renewable Energy Target), and replaced the previous Federal Government rebate. Solar Credits, also known as the “REC multiplier” currently allow 5 times the amount of RECs to be created for eligible small generation units (like your solar electricity system). Credits are not means tested, so anyone who meets the eligibility criteria can claim them.
What is a REC?
REC stands for Renewable Energy Certificate. The Federal Government grants you a number of RECS for your solar installation as its way of thanking you for helping to tackle climate change, and to provide financial assistance with the purchase. Each REC represents 1 MWh (Megawatt hour) of energy able to be produced. RECS have a market value which fluctuates, if not daily, at least weekly. The changing value of RECS can cause some confusion, as does the differing number of RECS depending on the location of the installation. The same sized system installed in Melbourne or Hobart will receive fewer RECs than installations further north as these southern areas have less sunshine. So less renewable energy is produced. Clean Energy Solar can explain RECS in more detail once we know which of our systems best suits your needs.
Claiming the Solar Credits/RECS yourself
Clean Energy Solar can organize the paperwork so that the value of RECs is applied as a discount, reducing your upfront costs of the solar power system and guaranteeing the return! Or you can decide to hold onto them as your rainy day fund and then sell them at the going rate. If you choose to sell your RECs they will be purchased by industry and offset against their fossil fuel usage or carbon generation. Owners can do this (generally through an agent) by applying to the Office of the Renewable Energy Regulator (ORER) any time within 12 months following the date of installation. The uncertainty about future RECs values and the complexity of the paperwork are the reasons why most customers chose to take the discount up front.