New South Wales solar incentives and feed-in tariffs 2021

Published: 17 March 2021

Are you a NSW homeowner looking for solar? We’ve collated the solar incentives available in 2021 to help you make the switch!


Are you a homeowner looking for solar? Below we’ve detailed the New South Wales solar incentives available in 2021. 

Homeowners in New South Wales are charged an average electricity tariff of 30.65 cents/kWh, according to the Australian Energy Market Commission (AEMC) and prices reach up to 55 cents/kWh during peak hours. However, expensive electricity makes solar even more valuable, with a higher savings opportunity.

New South Wales solar incentives 2021

Currently, the SRES is the only program that offers New South Wales solar incentives. However, this incentive alone reduces the net cost of solar installations by around 33%. Solar installations with up to 100 kW of capacity are eligible, which also makes the incentive useful for commercial properties.

The SRES does not offer incentives directly, and instead it awards Small-scale Technology Certificates (STC). The calculation is based on the expected electricity production between the installation year and 2030, with one STC awarded for every 1,000 kWh of estimated production.

Example STC scenario: 

  • A 5-kW solar system in Sydney is awarded 69 STCs. 
  • This solar PV system has an expected production of 69,000 kWh over a 10-year period.
  • Considering that the STC price is around $38, the resulting incentive is around $2,662, or $532 per kW.
  • Assuming a solar system price of $8,000 before incentives, the net cost drops to $5,338, or 33% less.

Since inland areas get more sunshine than coastal regions of NSW, systems here also qualify for more STCs. For example, a 5-kW installation in the mining town of Broken Hill gets 76 STCs, equivalent to $2,888 at $38 per STC with the incentive per kilowatt increasing from $532 to $578.

Remember, a solar system is only eligible for STCs if installed by a Clean Energy Council Accredited Installer like Instyle Solar. The solar panels and inverters must also be in the CEC approved list, and the installation must comply with Australian and New Zealand codes.

If you need further information about the Small-scale Renewable Energy Scheme, please visit the Australian Government Clean Energy Regulator website.

Other Incentive Programs 

The NSW government offers two local incentive programs for solar power, which complement the STC incentive:

  • Empowering Homes solar battery loan offer
  • Solar for low income households

Empowering Homes program 

The Empowering Homes program offers interest-free loans of up to $14,000 for new solar systems with batteries, and up to $9,000 for adding batteries to existing solar installations. Loans for combined systems are repayable in eight years, while loans for battery retrofits are repayable in 10 years. These loans are available for households with a yearly income of up to $180,000. The owner must live in the property where the loan is used, which must be connected to the grid. 

  • In Australia, solar batteries cost around $1,000 per kWh of storage capacity, which means a $9,000 loan can finance a 9-kWh system.
  • For combined installations, a 5-kW solar PV system can be financed with around $5,500 after subtracting the STC incentive. In this case, the rest of the $14,000 loan can be used for a battery system.

As of 2021, loans from the Empowering Homes program are available for certain postcodes in the following locations: Bathurst, Blayney, City of Blue Mountains, Cabonne, City of Central Coast, City of Cessnock, Dungog, City of Hawkesbury, Kempsey, City of Lake Macquarie, City of Lithgow, City of Maitland, Mid-Coast, Mid-Western, Muswellbrook, City of Newcastle, Oberon, City of Orange, Port Macquarie-Hastings, Port Stephens, Singleton, Tamworth, Upper Hunter Shire, and Walcha.

Solar for low income households program

The Solar for low income households program offers free solar systems for qualifying homes. The system capacity is 3 kW, and it will benefit 3,000 homes in Central Coast, North Coast, Sydney-South, Illawarra-Shoalhaven, and South Coast. To be eligible, a home must meet the following conditions:

  • Currently getting the Low Income Household incentive, and agreeing not to get the incentive for 10 years in exchange for the solar installation.
  • Having a Pensioner Concession Card or Department of Veterans’ Affairs Gold Card.
  • Owning the home for the solar PV system installation.

The program is only available for homes without solar systems. In other words, the free 3-kW installation cannot be used to expand an existing solar array.

Virtual Power Plant 

NSW homeowners with solar battery systems can also join a virtual power plant (VPP). A VPP connects many batteries together, coordinating them to act as a single power source. When joining a VPP, the local electricity company is granted access to your home battery, and you are rewarded for the use of that storage capacity. Conditions vary depending on the VPP operator, but you can expect to earn an extra $100 to $200 per year according to the NSW government.

New South Wales solar power feed-in tariffs

The feed-in tariff (FIT) is the electricity rate paid to you for surplus generation from a solar system. A favorable tariff can be considered a type of solar incentive, since unused generation becomes more valuable for homes and businesses.

NSW does not have a minimum FIT, but the Independent Pricing and Regulatory Tribunal (IPART) has established a benchmark of 6.0 to 7.3 cents/kWh. However, local electricity companies offer FITs as high as 22 cents/kWh.

The following example is very simple, but it illustrates how an FIT affects the savings capability of a solar system:

  • Assume that a 5-kW solar system generates 7,000 kWh per year, but only 5,000 kWh are used by the owner, and the other 2,000 kWh are exported to the grid.
  • With an electricity price of 30 cents/kWh, the 5,000 kWh become $1,500 in savings.
  • Using the FIT benchmark of 6 cents/kWh, the 2,000 kWh of surplus production are only worth $120. However, with a more favorable FIT of 16 cents/kWh, the value of this energy increases to $320.
  • The annual savings are $1,620 with the benchmark FIT, but they increase to $1,820 with a more favorable FIT (12% higher).

For the latest feed-in tariffs and updates visit: 

Am I eligible for a solar incentive? 

How much can I save with solar? 

Learn more via How Solar Works

new south wales solar incentives

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