Solar energy

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Overview

Solar panels, also called solar photovoltaic (PV) systems, use sunlight to generate electricity. Many Victorian property owners are considering solar panels, to generate clean power and help reduce energy bills.

To make the best choice, you need to understand what you are signing up to. Some systems can be expensive and any problems with installation or repairs can add significant extra cost. You should also consider how rebates and feed-in tariffs will contribute to the return on your investment.

Carefully research the products and suppliers before signing a contract for a solar energy system.

A typical 1.5kW (kilowatt) solar panel system installed in Melbourne will produce about a third of an average household's daily energy consumption. This will reduce your electricity use but you will still need to draw the rest of your electricity from the state electricity grid.

The amount of electricity solar panels generate depends on several factors, including the climate, the angle and size of the panels, and whether they are installed on a north-facing roof. You should consider all of these factors when you weigh up the costs of a solar panel installation.

Before you buy a solar energy system

Do some reading

Shop around

  • Decide what type of solar panel system you want and what system would suit your home.
  • Get quotes from several Clean Energy Council-accredited installers. To check if an installer is accredited, visit the Find an installer page on the Clean Energy Council website.
  • Read online reviews and feedback about the retailer.
  • Ensure you are comparing quotes for the same type of solar panel system and features.
  • Talk to your energy retailer - particularly about the rates for electricity drawn from and fed back into the grid.

Before signing a contract

  • Check that the contract's terms and conditions are the same as any verbal assurances the salesperson gave you.
  • Check the contract specifies a delivery date and the supplier's policy if the delivery date is not met.
  • Read and understand the warranty conditions.
  • Read and understand the supplier's policy on repairs.
  • Negotiate the amount required as a deposit (usually 10 per cent).

Solar certificates ('rebates')

Small-scale technology certificates, commonly called 'solar credits' or 'solar rebates', are tradeable certificates provided by the Commonwealth Government as an incentive to install renewable energy products, such as solar panel systems.

The most common way to get these certificates is through a registered agent, such as a solar panel company. The company gives you an up-front discount off the cost of the system, or an equivalent cash payment, and then seeks reimbursement of the discount from the Government. Alternatively, you can create and trade these certificates yourself.

The number of credits and the discount or cash payment amount you receive will depend on the installation location and the amount of electricity in megawatt hours (MWh) the system will generate over 15 years or by 2030 - whichever comes first. One certificate is equivalent to one megawatt-hour of electricity production over that period. The solar panel installer should give you this information before you sign the contract.

For more information on solar certificates, visit the Claiming small-scale technology certificates page on the Clean Energy Regulator website.

Feed-in tariffs

A solar feed-in tariff is a payment you receive via your electricity retailer as a credit on your bill for the excess electricity that your solar energy system produces and feeds back into the state's electricity grid.

For example, at certain times of the day your solar panels may be producing more electricity than your household is using. If it is a bright sunny day (the system will be generating electricity), but no one is at home (so energy consumption is low), your system may be producing excess electricity. By feeding this excess electricity back into the grid, you can gain financial returns through feed-in tariffs.

The feed-in tariff is a rate that is set per kilowatt hour (kWh).

The Victorian feed-in tariff currently offers a minimum of 11.3 cents per kilowatt hour for excess electricity fed back into the grid. All electricity retailers with more than 5,000 customers must at least offer this minimum rate, but they may offer different packages and terms and conditions.

For information on the minimum feed-in tariff, visit the Feed-in Tariffs section on the Essential Services Commission website.

Problems with a solar product or installation

If you have a problem with a solar product, such as a faulty inverter, view our Problems with a product section.

If you have a problem with the installation of your solar product, or with other services, view our Problems with a service page.

For advice on dealing with a business that has become insolvent, view our Insolvency page.

Problems with your energy retailer or distributor

If you have been unable to resolve a problem or complaint with an energy retailer or distributor, or feed-in tariffs are not being applied to a bill, visit the Energy and Water Ombudsman (EWOV) website or call 1800 500 509.

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