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Government Grants to Cover 100% of the Cost of Solar Panels

5 minute read

By Lesley Harrison

If you’re an Australian homeowner or small business owner who’s interested in making your property greener, you may wish to consider installing solar panels. Solar power works particularly well in Australia thanks to the long hours of daylight. Many homeowners are able to store up solar power in batteries during the day and use it to keep appliances running overnight, saving energy and money.

The up-front investment in solar panels can seem expensive, especially if you’re funding it out of pocket. However, many government grants and rebates are available that can cover all or part of the cost of solar panels, reducing the financial burden.

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Why Get Solar Panels?

Solar panels are a clean and efficient way of generating energy. Increasing concern about climate change means governments around the world are looking to use greener, cleaner sources of energy. Currently, solar panels account for just 0.1 percent of the country’s energy consumption.1 The government wants to see this change because panels last for a long time if they’re cared for properly, and they can be an unobtrusive way of generating clean energy, reducing reliance on fossil fuels.

How Much Do Solar Panels Cost?

The cost of solar panels can vary depending on where in the country you are and the size of the system you want to have installed. In general, a small (three-kilowatt) system costs around $4,000. A 10-kilowatt system costs an average of $9,610.2 Homeowners in Perth typically pay less than those in Darwin. It pays to shop around and get several quotes before choosing a solar panel installer. Also, check that your installer is approved if you’re applying for government grants.

How Much Can You Save With Solar Panels?

The amount of money a solar system can save you depends on the size of the system as well as current energy prices. One commonly cited rule of thumb is that a solar system can save you $400 per kilowatt of solar. This means a five-kilowatt solar system may save you $2,000 per year.

These potential savings make investing in solar a wise move financially because even if you pay for the system upfront, you can expect to see it pay for itself over a period of just three years.

How to Get Free Solars Through Government Grants

Several grant programs and options are available to help small businesses and homeowners in Australia get started with solar power. These include rebates in the form of the Small-scale Renewable Energy Scheme, feed-in tariffs and special subsidies for energy storage and off-grid solar systems. In addition to the larger government grants, local grants and programs are often available to support organisations. Small business owners can find out about available grant options on the government grant finder.3

Solar Grants for Businesses

The Small-scale Renewable Energy Scheme is open to small businesses. The scheme is run by the government and provides financial incentives to encourage the installation of solar panels. However, the government emphasises that the incentives aren’t provided in the form of a rebate from the government. Rather, solar panel owners earn Small-scale Technology Certificates based on the amount of energy they produce, and the recipients can sell them or assign them for a negotiated price.4

Solar Grants for Homeowners

If you’re a homeowner, you can also take advantage of the Small-scale Renewable Energy Scheme. Many homeowners opt to use this scheme to subsidise the cost of their solar panels. Instead of receiving the Small-scale Technology Certificates themselves, they assign them to an agent in return for a discount on the cost of the solar panels. Some companies offer free solar panels in return for assignment of the STCs, which can be an appealing option for a homeowner who can’t afford to pay the up-front cost of panel installation.5

Feed-In Tariffs

Feed-in Tariffs are similar to STCs, but instead of being used for a discount on the up-front cost of the solar panels, a feed-in tariff involves selling the energy generated from the solar panels back to the energy supplier. The rates offered for feed-in tariffs vary depending on where you are in the country, and in general, feed-in rates aren’t as generous as the payments offered under the STC system. However, over the lifespan of the panels, feed-in payments can be lucrative.

Solar Hot Water System Subsidies

In addition to funding for solar panels, some states offer solar hot water rebates or other payments. For example, in Victoria, the Solar Homes Program offers payments of up to $1,000 toward the cost of solar hot water systems.6 The City of Adelaide Council runs a similar program. In addition, the ACTSmart Program offers up to $1,200 toward the cost of solar water heaters.7 Contact your local council for information about the programs and rebates available in your area.

Subsidies for Energy Storage

Batteries are useful for storing solar power during the day. This stored energy can be used at night when demand often increases. Small businesses can claim a 100 percent tax deduction for installing batteries.8 In addition, some local programs help homeowners fit solar battery systems. For example, the City of Adelaide’s Sustainability Incentives Scheme includes incentives for homeowners and businesses to invest in electricity management systems and green energy. These financial incentives can be used to purchase batteries for solar power systems.9

Off-Grid Solar Subsidies

The original Renewable Remote Power Generation Program has come to an end. However, homeowners who live in remote areas can still take advantage of the Small-scale Technology Certificates program. This program can be particularly valuable for larger off-grid installations, saving thousands of dollars on the cost of installing a system. To qualify for a rebate under the small-scale renewable energy scheme, the installation must be a full, new system rather than an expansion of an existing set of solar panels.

Finding Grants in Your Area

If you’re not sure if grants are available for solar power in your area, the first place to contact is your city council or state government. They can offer advice on programs running at a local level as well as on national schemes you may be eligible for. The grants available change regularly, and regional energy providers often run their own incentives, so it pays to shop around to make sure you’re getting the best long-term deal.

Is Paying Full Price for Solar Worthwhile?

Most homeowners and small business owners in Australia qualify for at least a partial subsidy of the cost of a solar panel system, and some may be able to get the full cost covered. If you don’t qualify for support for some reason, it’s still worth considering solar power. Look for low-interest loans and consider the length of time it takes to recoup the cost through feed-in tariffs. If you’re planning on staying in the property for at least three to five years, the panels are likely to pay for themselves and become profitable.