Reading Between the Lines of Government Solar Incentives

By March 22, 2021April 18th, 2021No Comments

Even though solar power has always offered hope for a greener future, the technology is relatively more expensive than competing options. Photovoltaic cells are costly to make and the solar panels themselves need to be handled as well as installed very carefully.

We can safely say today that without government subsidies and financing options, solar power wouldn’t have become as popular or accessible as it is today. Introduced in 2011, the Solar Energy Rebate has helped finance over one million solar installations with most homeowners receiving a discount of $3,990 on their purchase.

The rebate also has no sudden expiration date and will be gradually phased out through 2030. But even as solar incentives are driving PV adoption, potential buyers may have many questions. While the discount itself is given against the purchase, there are several scenarios where the buyer may feel they are eligible for cashback when they aren’t and vice-versa.

Let’s take a look at what systems are eligible for the solar incentives program and some what-if circumstances which may require special consideration.

Solar System Eligibility Criteria

Firstly, let’s understand what a solar incentive is. While it is typically called a rebate, the incentives are Small-scale Technology Certificates (STCs) the government issues against the total solar capacity you install.

These certificates can then be traded in an open market against a constantly changing monetary value. Be sure to check out our article on how federal incentives reduce the cost of solar if you wish to learn more on how STCs work.

Every solar panel (and household) must pass certain eligibility requirements before they can earn STCs. These are —

  • Your system is equal to or less than 100 kW in size.
  • Your panels and inverters are approved by the Clean Energy Council.
  • The system is installed by a Clean Energy Council accredited installer.

Most solar energy systems will fall within this range, and will therefore be eligible for earning STCs. However the above criteria are for original systems only and as we mentioned above, there may be scenarios requiring special consideration.

You Add Panels to Your Existing Solar Power System

So long as the panels are CEC approved, your overall solar power system is less than 100 kW, your inverter can handle the added capacity, and all components meet relevant standards, your system can earn STCs.

Note: If your power system exceeds 100 kW limit, then you can apply for Large-scale Solar Certificates which are issued against power stations.

You Get a Brand New System

Your new system will be eligible for STCs as well provided it adheres to all the guidelines mentioned above. A new system will only be counted as such if it has its own inverter.

You Replace Your Existing System with a New One

Again, your new system can earn STCs if it meets CEC standards. Since this is a new system, it will be treated by the government as a fresh installation, and is therefore eligible for solar incentives.

You Replace Panels on Your Existing Solar Power System

You will not be eligible for earning fresh STCs here since the certificates are issued against the total capacity of a solar power system rather than individual solar panels. You can however apply for solar incentives if your new panels add capacity to your power system.

Your Existing Solar Panels are Damaged and You Install Fresh Ones

This one’s tricky. If you replace the entire system, i.e. panels and inverter, then you can earn STCs on your next solar power system. But, if one or more components from your previous system is still in use, then you cannot earn any STCs unless you are adding capacity to your system.

Still Confused?

Government legislations are never an easy read. Despite all the clarifications and simplifications, there’s always a question that gets left unanswered or a doubt that goes under the radar.

If you have specific inquiries about solar power rebates and incentives that we haven’t covered above, then feel free to contact us. We’ll be happy to help you find answers that help you make the right decision.