Why Invest in a Solar Power System?

There are now over 1.3 million roofs in Australia with Solar Photovoltaic (PV) panels installed, with the vast majority having been installed in the last 3 years. This has been due mainly to the introduction of the Federal Government’s Solar Credits Scheme which provides a subsidy for the installation of a system.

On top of this, Feed-in tariffs in each state pay you for the excess power your system produces.

Solar Credits Scheme (Federally funded)

  • You receive a certain number of Small Technology Certificates (STC’s) depending on the size of the system you install and which region of Australia you live in.
  • Ranges in value from $1,200 for a 1.5kW system up to $10,000 for a 30 kW system.
  • STCs were formally known as Renewable Energy Certificates (RECs)
  • The installer will claim these on your behalf and offer the value as a discount on the price of installation.
  • All you need to worry when comparing system prices and working out financial returns is the out of pocket cost of the system – This is almost always the price advertised and quoted. You can work out your returns using our Solar Payback Calculator here.

Feed-in Tariff (Funded by State Governments and Electricity Suppliers)

  • The payment for each Kilowatt Hour (kWh) or ‘unit’ of energy your systems produces which isn’t used in your home and is therefore sold back to the grid.
  • Varies by state – More info here – State Feed-in tariffs
  • State’s impose a limit on the maximum size of system you can install to qualify, go over this size and you won’t be paid for anything you export. Generally 5kW (around 20 panels).
  • The system size limit is on inverter capacity so you can actually install a lot more panel capacity compared to your inverter. Eg 7kW worth of panels on a 5kW inverter.
  • You’ll receive a new bi-directional meter which records what you’re exporting as well as what you’re importing. You’ll be charged for this separately so be sure to ask your installer how much this is and whether or not they organise it.

Make sure that you understand these points as it will help you choose which size system to install and how best to get the maximum benefit. You’ll need to know whether or not it’s worth investing in the biggest system possible with a view to making an income from the system or a more modest system that simply reduces your bills.

The size of system you install depends on:

  • How much energy you use, and
  • When you use the bulk of your electricity and the Feed-in Tariff you’ll receive in you state.

When should you use your power to make sure you get the greatest benefit from the system?

As the Feed-in tariffs in each state have been reduced over the last year to the point where they are much lower than the rate you actually pay for power (8.7c in WA versus 30c from the grid for example) you’re better off using the power your system produces yourself and offsetting the power you would have drawn from the grid.

  • Shift usage of power in to the middle of the day where possible. You can do this by putting your washing machine, dishwasher or dryer on delay so that they operate in the middle of the day.
  • Orientate your system to the west. This has the effect of shifting the systems production towards later in the day when you generally get home from work or when air conditioners are switched on meaning that you effectively get paid the same amount for your solar power that you as you pay for electricity from the grid, which is a much better rate than most Feed in Tariffs.

Where in your solar journey are you?

Download Your FREE Beginner’s Guide To Solar Power!

Beginners Guide to Solar Power

If you’re considering solar for your property or just looking to maximise the savings for your solar system, download a FREE copy of our "Beginner’s Guide To Solar Power".

Become an expert and better understand the ins and outs of solar power and solar PV systems for your property.

Includes detailed explanations and diagrams of the various types of solar systems and their parts, solar battery storage systems, Government incentives, expected ROI periods, finance, energy saving tips and more!

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Understanding Batteries

Off-Grid Systems

For some households a battery system can be of great benefit and minimise a home’s reliance on the grid. However, it’s important to understand for a battery to be useful your solar system needs to be generating excess energy for the battery to store, which you can then use at night or when the sun is not out.

When selecting a battery, you’ll want to invest in a system that is most suited to your home and can drive the best return on investment (ROI). Despite a larger upfront cost, a higher quality battery may significantly increase your ROI.

    Battery systems start from $6,000 and costs can vary greatly based on the following factors:

  1. Cycle Life-Time

    The number of times a battery can fully charge and discharge.

  2. Battery Power (kW)

    How fast it can be charged or discharged.

  3. Storage Capacity (kWh)

    The maximum amount of energy a battery system can store.

  4. Battery Management System (BMS)

    An electronic ‘smart’ system that gathers data and manages the battery ensuring it does not overload or operate outside of its safe functioning zone..

  5. Inverter

    Battery systems require their own inverter if your solar system does not have a hybrid inverter.

  6. 'All-In-One Unit’

    A system which includes the battery, BMS and an inverter all in one unit.

  7. Warranty

    Length of time or cycles the battery system is under guarantee.

  8. Blackout Protection/Backup

    It’s important to note this is not a common feature of a battery system and could cost thousands of dollars to include. Blackout protection not only requires additional components but also a specialised installation and rewiring. For grid-connected homes, the cost for blackout protection can outweigh the benefit.

Additionally, if your purpose for adding battery is to go Off-Grid and become completely independent from the grid you will need to ensure your solar system can generate enough energy to power your home and your battery system is large enough to store this energy. For homes in metro areas going Off-grid is not cost effective and is only recommended for those in remote areas with limited access to the grid. Off-grid solar systems with battery start at approximately $30,000.