Further Reduction to the Solar Credits Multiplier
06 May 2011
The Government announced yesterday that the reduction in the Solar Credits multiplier will be brought forward one year. This means that the rate at which your STCs are currently multiplied by will reduce from 5 to 3 for all systems installed on or after 1 July 2011.
The STC market is significantly over supplied, with STC registrations averaging more than a million certificates per week. The 28 million target for 2011 will be readily exceeded and as a result the STC price has dropped significantly. With reductions in system costs and rising power prices solar PV has become more attractive to consumers and as a consequence sales and installations have increase dramatically. For example, in both the months of March and April this year more than 30,000 PV systems claimed STCs.
The reduction in the multiplier from 4 to 3 from 1 July this year is intended to take some of the heat out of the market and support the STC price. With the introduction of a carbon price from 1 July 2012 the government has also reduced the multiplier from 3 to 2 from 1 July 2012 and from 2 to 1 from 1 July 2013. From 1 July 2013 there will be no additional multiplier and STCs will only be created at the normal rate (1:1)
To 30 June 2011 – Multiplier of 5
1 July 2011 to 30 June 2012 – Multiplier of 3
1 July 2012 to 30 June 2012 – Multiplier of 2
From 1 July 2013 – No Multiplier (1 on 1)
PV systems that have been sold prior to 5 May 2011 and installed after 30 June 2011 may still be eligible to receive the 4-times multiplier. The Governments intends to add transitional arrangements to the Regulations for those who meet the following criteria:
1. Compliance with all existing Solar Credits eligibility requirements
2. Written contract of the sale entered into before 5 May 2011, stating
- the customer’s name
- installation address
- name and address of supplier
- brand, model and total capacity of both the panels and the inverter
3. Documentary evidence that a deposit for the system was paid by the customer before 5 May 2011
4. A Statutory Declaration confirming possession of these documents and records maintained according to RET legislation.
We expect further details of ORER’s requirements for these arrangements to be announced shortly.
For further information, see the Government’s Solar Credits Fact Sheet: http://www.climatechange.gov.au/government/initiatives/renewable-target/~/media/publications/renewable-energy/fs-solar-credits-for-small-generation.pdf