Solar Electricity - Rebates and RECs

Renewable Energy Certificates (RECs)

RECs are electronic certificates, created when an eligible Solar Electricity system is installed. They're traded in a market and are ultimately bought by energy companies, as they count towards the company's compliance with government targets for renewable energy generation.

Each REC represents one megawatt hour of renewable electricity generated; for Solar Electricity systems, this is equivalent to removing one megawatt hour of generation from non-renewable (such as coal-burning) power stations.

To qualify for RECs, Solar Electricity systems are tested and certified according to Australian standards and listed on a register. The more efficient the system, the more RECs it creates. The most efficient systems qualify for about 30 RECs or more.

The $$ value of RECs

When you buy and install an eligible system, you have the option of keeping and trading the RECs, but most suppliers offer to buy them from you when the system is installed, providing a kind of discount. This is usually the easiest way to benefit from RECs, but it means you sell them at whatever value applies in the market at that time.

If you decide to keep the RECs to trade later, make sure you get documentation from the supplier stating that the ownership of the RECs has been passed to you. When you come to trade them you may find you need to sell them through an agent, who'll take a commission, possibly wiping out any benefit from higher prices.

RECs vary in value from week to week; at the time of writing the price was about $40 to $50 per REC, meaning you'd get $1200 to $1500 for installing a system eligible for 30 RECs.

As in any market, it's hard to predict long-term price movements. As energy companies start to meet their renewable energy targets by building wind farms, they'll need to buy fewer RECs. But on the other hand, the Federal Government might set tougher targets in future, increasing the demand for RECs. For the average consumer, it's probably best to work out a deal with your supplier at the time of installation and think of it as a discount.

You can subscribe to a weekly bulletin of RECs prices at the Australian Financial Markets Association website. For more details about RECs, also see the Office of the Renewable Energy Regulator website.

Rebates

All our Solar Electricity products qualify for RECs.

You can find out more at www.environment.nsw.gov.au/rebates/ccfhws.htm.