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Solar power - WTF are STC's, Solar Credits and how can they benefit me?

Discussion in 'The Pub' started by robsalvv, Dec 21, 2011.

  1. I'm thinking about getting solar PV installed - in the 14 months I've been with Energy Australia I've had 4 price rises and the January's is going to be a doozy. Then there's the carbon tax hike coming in June... Seems like it's the same story no matter who you're with.

    So I'm looking into solar.

    I'm a bit price sensitive. The solar crowds are saying that I shouldn't look at the initial capital outlay alone though because I can take advantage of RECS and STC's which are traded on the green energy market like stocks. I'm trying to get a handle on what these things are, but it's pretty disjointed. There's a base level of STC's, a deemed level and an eligibility based solar credit level which increases the number of STC's you can trade for the same sized unit... arrrgh.

    Can someone please explain to me in plain engrish what the frack these are and how they work!? Because if they mean money in the bank, I might stretch the budget and get a bigger PV system, because once the dust settles, the net capital outlay will still be within the budget. Any simple explanations will be appreciated, because the government and other sites are quite disjointed about it all.

    If you're a solar guru, read on and feel free to comment on my thinking/approach.

    I know I've missed out on the premium feed in tarrif of $0.60/kwh so will be eligible for the $0.25kwh rebate instead (which is small premium over current typical consumption prices), so I'm using that in some basic pay back calcs.

    I've got a fair handle on my annual power consumption given the 10 yrs of power bills in the shoe box... so as a minimum I want to cost a system that will create at least an average annual consumptions amount of power. If the bank and the roof can stretch to a bigger system I will (hence wanting to understand RECS, STC's, solar credits et). In about 5 years the small premium will evaporate and the rebate will be one to one... if I can manage a system that produces an average years consumption, then once the unit has paid for itself, that effectively means, free power :)

    Is my thinking right?
  2. You missed the boat, the gvt was offering $8000 towards PV setups for a few months but had to cancel it when so many people signed up. This was a year or two ago though..

    My understanding is that RECS etc are just things that you sell to companies that use them as credits to pollute.

    As for going big, solar credits is only up to 1.5kw systems

    Orer has some good info
    And there may be other state based rebates I'm not sure..

    Since they brought down the incentive it takes longer to be cost effective. The pv gear isn't going to last forever either, something to factor in.

    With the cost of electricity going up I think its a potentially smart investment.
  3. Yeh the incentives were there but the personal funding wasn't. The capital costs were much higher than they are today... the drop in feed in tarrif has dropped demand and the prices have dropped as a result.

    I think I'm starting to get an idea about what's going on. Power companies are required to buy these STC's which in turn subsidises their installation. It's a smart investment because is holds off them needing to build new capacity - we're installing the capacity at a fraction of the cost of new power generating plant.

    The solar credits multiplier only applies to the first 1.5kw of a PV system - the rest is applied at 1 STC per MW produced over the life of the unit. The black magic is determining how many MW's a unit will produce.
  4. might want to check the life span of the panels too
  5. Talking to my folks about it today. They hopped on the 60 cent deal I think. Worked out that they would pretty much get their energy for free at 32-35 panels. Or enough electricity for about $300 a quarter as a standard bill. Thats with a solar thermal water system as well.
  6. I do believe life span is about 20th years.
  7. Lilley, that doesn't sound right. My 26 panel system (4.75 kw) generates about $3200-$3500 a year at 45.7c per kw. At 60c mine would be generating about $4600. Of course they could just have huge electricity bills!

    Rob, you can basically roughly calculate the size of system you need to cover your electricity bills. A 1 Kw system will generate approx 1540 kw/h year in Canberra. So for example, my 4.75 kw system is 4.75 x 1540 x 0.457 cents = $3,342 per annum. Unfortunately will the lower rate you get, 4.75 kw system is 4.75 x 1540 x 0.25 cents = $1,828.

    To me, that's probably not worth doing at only 25c... My system cost $16k or so after rebates out of my pocket, but it means no electricy bills (save $3000 a year + a bit of a cash back) it won't take long to get the $$$ back and over the 20 year life it will generate around $70,000, saving me $54,000 off my electricity bills.
  8. Yeah my neighbour has a 4.5kw system and regularly gets 1000-1500 money back from the energy company...
    Would set it up myself too if i owned the place i was in ;).

    There is rumored to be a new type of panel being developed that for the same size, though with less weight, it can generate 3-5x as much power, and costs half as much to make with less environment damaging components..... Its only something ive seen alluded to in a few reports and articles, never a solid source. Guessing it would be a ways off yet if it even actually exists.
  9. bloke at work got in at 60c and get about $1k per quarter from the provider. Mind you he bought during the rebate period and got charged a premium for the system.

    Now that demand has dropped off you can get them cheaper.

    Still at 25c I've concluded it's not worth it. I however have a 2 story house, so the cost is higher and the roof space is less. Makes the equation that much less positive.

    The other thing to be aware of is there are different types of meters. I forget the names now, but if you get the wrong type you only get about 2/3 of the benefit. Do some research in this area.
  10. Soooo, if I was to set a 10% return as a bench mark, a 4.75kW system costing more than $18k would be a big fail. A 10% return is way better than I can get at a bank and it's not counted as income. It's a rebate. Sweet.

    I saw a 4.8kW premium components system priced at $16500 recently. After I sell the STC's, it might end up being a nett $13000 system. If it was to make $1800 pa's in rebates at $0.25/kWh, that's almost a 14% return. Not too shabby really.

    If you reckon your system generates 4.75 x 1540 = 7315kWh a year... then I should be sitting much prettier in Melbourne. And given that my annual energy consumption is like 5000 kWh/yr... that would put me well and truly in the black!

    Rightio... sounds like I'll be running the spread sheets to factor in some finance costings, but it looks like a goer.

    I still don't fully comprehend selling the STC's yet... but I guess I'll have a long chat with a system retailer and get it sorted.
  11. You cant sell the stc's, unless youre set up as a company that buys and sells them, cost about $500 from memory to buy/sell 'energy' credits. The company you get the solar system from pays you for the credits you generate. ie they give you a discount on the gear in exchange for the credits.
    remember to factor in the panels are losing efficiency every day. in 10 years time they wont be making the power they are now.
    Buy a dual input inverter/meter thingy, that way when the Gubbermint decide every one needs a wind generator you can plug that in too.

    When its installed, write down your power useage and generation all the time, keep Good records. A couple of friends of mine have solar systems and the power companies like to try and screw them on the bills.
  12. If the panels are silicon, they should be good for about 85% power generation in 40 years time. These have been used extensively, NASA found that after 40 years they were almost as good as new. The need to be cleaned reasonably regularly. In Melbourne, the rain every 3rd day will probably be enough. In Geraldton I have to clean them once every couple of months.

    Thin film panels are a bit unknown in terms of longevity. They should be considerably cheaped than silicon, but supply and demand mean they are about the same price.

    I would also check what you can do about the tarriffs you actually pay for your electricity. I have moved to what is called 'smart power' in WA, as I use most of my electricity overnight, and hardly any during the day. I buy for about 13c/kwh, and sell for about 47c/kwh. Theoretically I break even if I generate a third of what I actually use. My 3kW system generates about 3/4 of my needs in a year, hence I am currently owed about $350 by Synergy.

    Also remember, once it is paid for, any rises in electricity costs will be effectively money in your pocket as you do not have to pay for them. One of the reasons electricity is going up so quickly is to pay for my solar power going back into the system.
  13. Thanks middo. I did a bit of research just before the tarriff changed but didnt have the spare cash for the system.
  14. I'd check on that Rob. Normally they advertise the price *including* the STC rebate at the current market rate to make the system sound cheaper. That's fair enough as that's what you're paying out of your pocket.

    When I did mine all the quotes I got were like that and the solar company reduced the price of the system by the value of the STC's. Whilst I could have attempted to do it myself I didn't believe it was worth the hassle.
  15. we've had a 1kW system installed for about 43 years now, and I don't feel we're getting anywhere neat the return we expected, even in victoria. It works out about $50-60 off the bill per quarter even at 66c so it's not bad, but not what expected (family of 4, electric hot water, gas heating, quite a bit of daytime load). maybe 1kW isn't enough as all the later grants were for 1.5kW systems and many people seem to have even more. We've got a 2kW inverter though so we can upgrade.

    we did however have a nightmare with both Powercor and Origin in getting everything set up. We had to pull ahead the smart meter installation to get the high feed in tarrif and then origin sat on an error in our account for eighteen months and I had to go to the ombudsman to get it sorted out.

    I guess they've changed all the nomenclature have they? when we got the system installed, it was all about RECs (renewable energy certificates) these are tradeable by the installers and acted as a discount off the purchase prices for us. When we had solar electric hot water fitted recently the installer revised his quote between him making it and us taking up the offer due to the change in value of the RECs
  16. I spoke to a guy today who says that it was the norm for installers to take the STCs and RECS (when they were around) and offer a discounted price to the buyer, but a bunch of sellers went to the wall when the STC price crashed a little ways back and more of the sellers that are left are handing STC's to the buyer. They'll do the paperwork, but don't take ownership.
  17. Heya Rob, long tme no see, post, ride, etc. So appropriately it's a merry xmas post. I presently install Solar PV part time and installed aplenty systems. Sparky I subby to has done hundreds of systems. I also do quotes for a company. Shoot me a PM or FB your details and I will come drink a cup of your italian coffee, take a look at your premises (again) and give you the complete no frills, neine bullsheizen version of the solar equation if you so desire. I have as much information as your engineering brain can digest on the subject.
  18. A typical warranty lasts for 20 years.

    And to anyone who says, "Ah, but NASA is using astronautical grade equipment!": Kyocera guarantees 90% of original rated production after ten years, and 80% after twenty -- anything less and they'll repair it or send you more panels to make up the difference (at their discretion, as you would expect). They're a long time player in the game, too, so it's not like they're spouting stuff with the expectation of being long gone by the time it kicks in.

    1kw is unrealistic for the majority of households. You'll only get somewhere around (a bunch of factors involved) 3kwh a day out of it. If you have 'lecy hot water, you might actually see more benefit from getting a solar water system; they're relatively cheap and heat water directly (rather than light to electricity then to heat). In fact, for your family, you'd probably need more than 2kw (which would give ~5kwh/day).

    Rob, the main steps for getting a solar system are:
    #1 Measure current usage. All appliances should be measured separately.
    #2 Use the information from #1 to figure out what ways to reduce your consumption.
    #3 Take the result of #2 and sort out the panels, inverter, batteries, etc.
    #4 Installation.

    The first two steps are vitally important because they can save you thousands of dollars, and ensures you get a system that actually meets your needs.

    Another important factor is the quality of the panels and other equipment. 'Course, you can ignore this if you want to roast marshmellows and check your roof's fire resistance...

    I highly recommend Harmonic Energy. I admit that I haven't had an install done by them, but I do know that they really know what they're doing -- Jarrod was actually teaching for the sake of teaching, until he (and several other key teachers from the course) got too pissed off by incompetence from Swinburne :p. They'll actually do things like put mounting frames at an angle to face the sun properly (if the roof slopes down towards north-east or something), rather than plonking it down however is easiest. I'm sure they'd be happy to explain the things that are confusing you, free of charge :).
  19. You're right, they are only on the 25c rebate. But it cut their power bill in half for the last quarter.
  20. absolutely. we jumped on the bandwagon pretty quickly to offset (in our minds) the bike useage. At the time 1Kw was the most common install and before the porces dropped was all we could really afford. This year we've changed the hot water to elec boosted solar (gas boosted didn't make economic sense for us) and both kids are at school so we have minimal daytime power useage. I still want to add the extra 1kW to fully utilise our inverter, but panels alone (not part of a package) seem pretty expensive

    I guess the first two points of kohhors note can also be summarised as 'develope an integrated system'