How Much Money Do Solar Panels Save?
As electricity prices continue to rise, more Aussies are looking to reduce their power bills by installing renewable energy systems such as solar panels. The question is, how much can you actually save with solar panels?
In this article you’ll find out how much solar energy can save you and what solar rebates are available.
How much can you save with solar panels?
Before we go through the savings you’ll gain with solar panels, it’s important to understand what different variables can affect your potential savings.
- Feed-in tariff rate: When you send any solar energy back to the grid, you receive a rebate on your power bill. Depending on the state, Australian energy providers usually offer between 7-11c per kWh.
- Current energy usage and size of system: You need to maximise your return on investment (ROI) by choosing a system that can generate electricity at a rate that covers your power usage. You can find your power usage on your recent power bills (kWh).
- Location: The orientation of your house, tilt of the solar panels, shading, and the sun’s movement throughout the day all affect solar power production.
The table below shows, on average, how much a customer can save each year with solar panels. Keep in mind this is a general guide only.
The results are based on a 5kWh solar system costing $5,000. The cost of usage per kWh uses typical electricity costs for the specific state.
|
State |
Electricity Usage & Supply Rate |
Estimated Yearly Savings* |
Estimated Payback Period |
|---|---|---|---|
|
Usage: 29c/kWh Supply: 81c/day Average annual electricity bill in NSW: $1,420 |
$1,225 |
4 years, 4 months |
|
|
Usage: 24c/kWh Supply: 100c/day Average annual electricity bill in VIC: $1,319 |
$844 |
6 years |
|
|
Usage: 24c/kWh Supply: 95c/day Average annual electricity bill in QLD: $1,355 |
$1,218 |
4 years, 5 months |
|
|
Usage: 36c/kWh Supply: 81c/day Average annual electricity bill in SA: $1,842 |
$1,457 |
3 years, 7 months |
Source: https://www.solarquotes.com.au/solar-calculator/ *Estimated yearly savings based on a 5kW solar system costing $5,000 (incl. installation & rebates). The solar feed-in tariff rates used were 12c/kWh for NSW, QLD, SA, and 7c/kWh for VIC. General guide only.
What solar rebates are available?
While solar panel systems can be an expensive upfront purchase, there are Australian Government rebates that can help.
The Small-scale Renewable Energy Scheme (SRES) provides a financial incentive for households and businesses to install eligible small-scale renewable energy systems such as rooftop solar, solar water heaters and heat pumps. This happens via small-scale technology certificates (STCs), which are issued up front for a system’s expected power generation. The price of STCs varies according to market conditions. Further, the total level of subisdy you receive also varies depending on location and the size of your solar system.
Along with all the solar rebate programs, all states offer feed-in tariffs. A feed-in tariff is a small rebate you’ll get for each kilowatt hour (kWh) of unused electricity generated by your system not used by your home that is exported to the main grid. As feed-in tariffs are up to state policy, they vary depending on where you live.
If you’re looking at applying for any of the below rebates, make sure to check each state governments' corresponding website for more information e.g. eligibility.
NSW solar rebates
NSW currently offers one solar rebate - Solar for Low Income Households.
In exchange for forgoing their low-income household rebate for 10 years, qualifying households in NSW can receive a free 3kWh solar system. You must be a resident on the low-income household rebate in the Central Coast, North Coast, South Sydney, Shoalhaven Illawarra or the South Coast, to be eligible.
This program will be expanding its eligibility to more NSW residents over the next 12 months as part of the state government’s Energy Bill Buster program.
VIC solar rebates
Victoria has a selection of solar rebates available for residents.
The Solar PV Panel Rebate is a subsidy of $1,400 on the installation of solar PV panels for homeowners and rental properties. An interest-free loan equivalent to their rebate amount is also available to Victorians through this program. The loan must be paid off within four years.
Victoria is also supporting eligible Victorian households to install a solar battery by providing a point-of-sale discount up to a maximum of $2,950 for eligible customers.
Another rebate is the Solar for Small Business. This rebate covers up to 50% of the cost of installing a rooftop solar system with businesses eligible for a maximum rebate of $3,500. This means the total rebate amount will be capped at 50% or $3,500 of the cost on any approved system. For instance, if the net costs of solar are $10,000, then the rebate value applied is $3,500 (not $5,000). Or, if the net costs are $4,000, then the rebate value applied is $2,000 (not $3,500).
QLD solar rebates
Queensland currently does not offer any solar panel rebates outside the feed in tariffs (typically range from 8-12c).
SA solar rebates
South Australia does not currently offer any separate solar rebates to homeowners outside of those offered nationally and feed-in tariffs. The average feed-in tariff is 10 cents.
WA solar rebates
Western Australia does not currently offer any separate solar rebates to homeowners outside of those offered nationally and feed-in tariffs.
ACT solar rebates
Canberra residents have a few solar rebates on offer to them.
The ACT Government Household Battery Storage program provides ACT households and businesses with a rebate to install a battery storage unit connected to a new or existing rooftop solar PV system. The battery rebate for households is $3,500 (excluding GST) or 50% of the battery price (excluding GST) – whichever is lowest.
The Sustainable Household Scheme offers eligible homeowners the chance to borrow between $2,000 and $15,000 as part of an interest-free loan to go towards applicable upgrades e.g. solar panels, battery storage systems, electric heating and cooling systems, hot water heat pumps, electric stove tops, and electric vehicles.
The Home Energy Support Program provides up to $5,000 in rebates for eligible homeowners to help with the upfront costs of installing energy efficient products. Eligible homeowners include Australian Pensioner Concession and Veterans’ Affairs Gold Card holders. Homeowners can receive up to $2,500 with the cost of installing an eligible rooftop solar system. An additional rebate of up to $2,500 is available for eligible homeowners to install energy efficiency products including hot water heat pumps and electric stove tops.
TAS solar rebates
Tasmania also does not offer any solar rebates other than those outside the national STC program and feed-in tariffs (on average, 8.883c/kWh).
NT solar rebates
The Home and Business Battery Scheme offers homeowners and business owners a rebate of $450 for every kilowatt-hour battery system capacity, up to a maximum of $6,000. The scheme is eligible for the purchase and installation of a solar battery to a new or existing solar panel system.
If you already have solar or plan to add it to your home, talk to one of our lending specialists to find out about loans.com.au’s Solar Home Loan.
Find out in under 2 minutes if you qualify for one of our low rate home loans.
About the article
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