How STC’s Work

What is an SGU?

A small generation unit (SGU) is classified as a small-scale solar photovoltaic (PV) panel, wind or hydro unit.

Small generation units generate electricity and must be no more than 100 kW in size and total annual electricity output must be less than 250 MWh.

What is an STC?

The purchase of a SGU may entitle you to Small-scale Technology Certificates (STCs) if your SGU is eligible. An STC is generally equivalent to: 1 MWh of renewable electricity deemed to be generated by small generation units unless the Solar Credits multiplier applies.

STCs can be:

• Assigned to a registered agent (usually a retailer/installer) in exchange for a financial benefit such as a delayed cash payment or upfront discount
• Sold in the STC market or through the STC Clearing House.

STC prices:

The financial benefit or the total price given to you by your PV supplier or certificate broker/trader can vary from day to day. This is because STCs are traded in the STC market (like the stock market) and so prices vary depending on supply and demand.

The only time the STC price is fixed is if it is to be traded through the ORER-managed STC Clearing House.

Prices of STCs are fixed at $40 (excluding GST), regardless of what the STC market is doing.

In the past decade, when the certificates were traded via a market, the spot price of a certificate has varied between AUD$15 and AUD$60.

Brokers monitor the price of certificates and their information can be found on the web.

Installation advice and procedures:

• You must be the owner of the system at the time it is installed to be entitled to assign or create STCs.
• In some circumstances where the SGUs are installed in new buildings, the owner can be the builder or property developer.
• Units must be installed and all documentation supplied before STCs can be created and registered.
• Do not assign your STCs twice (before and after the system is installed). Do not assign your STCs to more than one entity.
• STCs must be registered within 12 months of the installation date of the SGU.

How to determine how many STC’s your system will receive:

The number of STCs an SGU is entitled to is calculated by determining the amount of electricity the SGU produces over a determined period (called a deeming period). Units are usually deemed for the maximum period of 15 years to receive the maximum amount of STCs up-front

Go to the SGU STC Calculator and select your system size. This will display the number of STCs for which your system is eligible.

Solar Credits

Solar Credits is a mechanism which increases the number of STCs able to be created for eligible installations of SGUs through the use of a multiplier.

• Solar Credits are not means tested.
• Solar Credits apply to the first 1.5 kilowatts (kW) of on-grid capacity installed in an eligible premise OR to the first 20kW of capacity for off-grid systems.
• Generation from capacity above 1.5 kW (on-grid) or 20kW (off-grid), either on the original unit or on any additional capacity installed at a later date, 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 off-grid SGU your system may be eligible for Solar Credits over and above those applicable to grid-connected systems.

The current SRES Legislation multiplier is as follows.

Installation Period Multiplier

• 1 July 2011 – 30 June 2012 3 x number of eligible STCs
• 1 July 2012 – 30 June 2013 2 x number of eligible STCs
• 1 July 2013 on-wards = 1 x number of eligible STCs (i.e no multiplier)

Eligibility criteria for Solar Credits

The SGU must comply with all eligibility criteria before it is entitled to Solar Credits.

• The unit is installed at eligible premises between 9 June 2009 and 30 June 2014;
• The SGU is a new and complete unit. A unit is complete if: it is capable of generating electricity in a form that is usable at the eligible premises where it is installed without the need for an additional part or parts to be added to or incorporated into the unit.
• It is wired directly to the premises where it is installed, so that its output is capable of being metered at the premises or the unit includes a meter that is dedicated to measuring its electricity output.
• At the time of STC creation in the REC Registry, Solar Credits have not been claimed on any previous set of certificates created for the same unit – for eg, on certificates (which may have been RECs submitted prior to 1/1/11) submitted for previous deeming periods (only applicable if you have chosen 1 or 5 year deeming periods). STCs for subsequent deeming periods are created at 1:1 value.