SOLAR CREDIT - Renewable energy
Solar Credits program is part of Australia's Renewable Energy Target. Under this initiative, every megawatt hour of qualifying energy generation is eligible for renewable energy certificates (RECs). RECs should not be confused with the tax credits that renewable energy projects are eligible to receive.
Renewable Energy Credit is one of two main outputs or benefits from the generation of new power from renewable sources. Renewable power generation creates actual power in the form of electricity, and environmental benefits to society from “green” power production – such as minimizing pollution and slowing the rate finite fuel resources are used.
The actual power is sold into the local grid, and the societal benefits are sold in the form of Renewable Energy Credits or “RECs”, sold separately as a commodity into the marketplace. While RECs are not actually a measure of power, each REC represents one megawatt hour (MWh) of renewable-generated energy. For each REC purchased the customer is able to claim the equivalent MWh of energy reduction as an offset to their conventional energy use. Because RECs provide an additional revenue stream to renewable energy projects, they are essentially a subsidy meant to allow clean resources to economically compete with fossil fuel-based resources.
Solar credit is a plan means to ensure a business opportunity for additional renewable energy generation using a mechanism of tradable REC’s (Renewable Energy Certificates).
Solar Credits are a piece of the RET plot, to encourage families, organizations and little associations that install small-scale solar systems (along with wind and hydro) by multiplying the number of REC’s to be created for qualified installations. As a homeowner, energy costs can make up a significant portion of your recurring monthly expenses.
With energy efficient appliances and home upgrades, it is estimated that you can save anywhere from 5 to 30 percent on your utility bills. Energy efficient appliances consume less energy throughout their service lives without sacrificing quality and are an excellent way to save on your energy expenditures.
For getting the solar credit you’d prefer to research your own eligibility for the RET scheme, The system must have been installed no more than 12 months prior to the date of application
- The system must be an eligible 'small generation unit' meaning:
- a solar PV system of up to 100 kilowatts (kW) capacity
- a small wind turbine of up to 10kW capacity
- a micro-hydro system of up to 6.4 kW capacity.
- The system must be installed at eligible premises (houses, apartments, and shops are all eligible).
- The system must be a new and complete
- No more than one system at eligible premises is entitled to Solar Credits.
- Solar Credits may only be created once for a particular installation.
The amount of money a solar panel owner will receive for his or her SREC varies by state and can range from under $50 to over $300 per SREC. This price depends on market factors of supply and demand, as well as a state’s alternative compliance payment (ACP). The ACP is a per-MWh fine that electricity providers must pay if they don’t meet their SREC requirements, and serves as a ceiling on SREC prices – electricity providers will save money by buying SRECs, but only if the SRECs cost less than the ACP. Solar Renewable Energy Certificates (SRECs) are a solar incentive that allows homeowners to sell certificates to their utility. A homeowner will earn one SREC for every 1000 kilowatt hours (kWhs) produced by their solar panel system.
SRECs exist as a result of a regulation known as the renewable portfolio standard (RPS). Renewable portfolio standards are state laws that require utilities to produce a specific percentage of their electricity from renewable resources