REC FAQs

1. What is the Renewable Energy Target?
2. What are RECs and where do they come from?
3. Which systems are eligible for RECs?
4. Is my solar water heater or heat pump system eligible for RECs?
5. What is a REC worth?
6. Will I get a better price for my RECs in the future?
7. What information do you need to pay me?
8. What is the deeming period for PV systems?
9. What are the climate zones?
10. How many RECs can I claim from my system?
11. When do I have to claim my RECs?
12. Can I get RECs for extensions to an existing PV system?
    
13. Do I need to list the income from RECs on my personal income tax return?

1. What is the Renewable Energy Target?

The Renewable Energy Target was established in 2001 by the Australian government to support the uptake of renewable energy. It was structured so that by 2020, 20% of Australia’s electricity will come from renewable sources (solar, wind, hydro, biomass). The Office of the Renewable Energy Regulator administers the scheme under the Renewable Energy Act 2001.

Renewable energy is measured in Renewable Energy Certificates or RECs (see below for ‘What is a REC?’). Electricity retailers have to purchase a set number of RECs each year and ‘surrender’ them to the government or pay a penalty. The number they must surrender is a percentage of their overall electricity supply.

2. What are RECs and where do they come from?

A REC (Renewable Energy Certificate) is a measurement of renewable energy which can be traded for cash. One REC represents one megawatt hour (MWh) of electricity.

RECs can be generated from a number of systems, including solar hot water, heat pumps, solar PV and small wind generation units, provided they meet certain conditions (see ‘Which systems are eligible?’ below).

3. Which systems are eligible for RECs?

The REC scheme covers 3 types of systems:

• Solar water heaters and heat pumps
• Small generation units – either solar PV (photovoltaic) systems, small wind systems, small hydro systems or small biomass systems
• Power stations – medium to large scale systems e.g. large wind turbines. Unlike the first 2 categories, power stations create RECs on an ongoing basis. Green Energy Trading can't create RECs for these systems, instead they must register with The Office of the Renewable Energy Regulator to get RECs.

4. Is my solar water heater or heat pump system eligible for RECs?

Several thousand solar water heater and heat pumps are eligible. The Office of the Renewable Energy Regulator (ORER) determines which systems qualify and they are listed here http://www.orer.gov.au/publications/index.html#factsheets. They also assess applications for new products. RECs can only be created for products that are on the list here http://www.orer.gov.au/swh/register.html.

5. What is a REC worth?

RECs are traded on the open market and the price can vary several times a day- just like the stock market. Since the scheme began in 2001, REC prices have ranged from $11 - $52. To find out our current prices see the REC prices page.

6. Will I get a better price for my RECs in the future?

There are many factors which impact REC prices. For more information visit How are RECs priced.

7. What information do you need to pay me?

If you’re the system owner and you are claiming the RECs we’ll need:

• Your assignment form, these are on our website
• Proof of purchase (typically an invoice or electrician’s/ plumber’s certificate of compliance)

If you’re an installer or retailer giving your customers a point of sale discount we’ll need:

• Your assignment form, these are on our website. Contact us and we can tailor a form for you with your logo and details
• Proof of purchase (typically an invoice or electrician’s/ plumber’s certificate of compliance)
• An invoice from you to us for the amount of the RECs plus GST

8. What is the deeming period for PV systems?

The deeming period is an estimate of the years your PV system will generate renewable energy. The maximum deeming period is 15 years. You can claim RECs for the full 15 years at once or you can put in a claims every 5 years or you can put in one claim every year. RECs for small Wind & Hydro systems can be claimed in 1 & 5 year deeming periods. Note that this doesn’t apply to solar water heaters and heat pumps.

9. What are the climate zones?

Climate zones affect how many RECs you can get for your system. Australia is divided into 4 climate zones which represent the different number of sunlight hours across the country. The following map provides an overview of the zones. To confirm which zone you’re in visit our Solar Zones page.

10. How many RECs can I claim from my system?

The amount of RECs each system can produce is different and depends on 2 factors; your system and where it’s installed (refer to ‘what are climate zones’).

Visit our Calculator page to determine how many RECs you can get for your system.

11. When do I have to claim my RECs?

You can only claim RECs AFTER your system’s been installed. If you’re installing a solar water heater you must claim within 12 months of the installation.

If you’ve installed a PV system on or before 6 October 2007 you can claim in 1 or 5 year deeming periods anytime after installation (refer to FAQ # 8: What is the deeming period for wind or PV systems?). If you installed a PV system after this date you can claim in 1, 5 or 15 year deeming periods but you must claim within 12 months of the installation.

If you installed a wind or hydro system on or before 6 October 2007 you can claim in 1 or 5 year deeming periods anytime after installation. If you installed a wind or hydro system after this time you can still only claim in 1 or 5 year deeming periods but you must make the claim within 12 months of the installation.

12. Can I get RECs for extensions to an existing PV system?

Yes, however additional information is required. You’ll need to provide details on where the upgrade is located in relation to the existing system. Please include a written description and/or a diagram as well as photos where possible e.g. "the four new panels are located to the right hand side on the north facing roof".

13. Do I need to list the income from RECs on my personal income tax return?

No you don’t. It’s the same as any other rebate you’d receive ie it’s not income but more a discount on the cost of your system. For example, if you buy a printer and get $100 cashback that’s a discount of $100 on the printer and not $100 income made from the printer.