Solar feed-in tariffs explained

A solar feed-in tariff is the amount of money you earn per kilowatt hour (kWh) of electricity from putting solar energy generated from your home panels back into the electricity grid. These rates vary based on which state or territory you live in, your energy retailer and your electricity plan.

There are two types of solar feed-in tariffs you need to be aware of:

• Gross feed-in tariffs
• Net feed-in tariffs.

Each tariff works slightly differently, but both pay you for the electricity your renewable energy system – such as photovoltaic (PV) solar panels or solar thermals – puts back into the grid.

Gross feed-in tariffs

If you’re on a gross feed-in tariff, your electricity retailer credits you for the electricity your system generates and then puts back into the grid, but charges you separately for the electricity you use. These solar feed-in tariffs are being slowly phased out of the market as net feed-in tariffs are more commonly implemented.

Net feed-in tariffs

Net feed-in tariffs are used in New South Wales, South Australia, ACT, Queensland, Victoria and Tasmania. Unlike gross feed-in tariffs, net feed-in tariffs only credit you for the solar energy you produce once your household or business has used the electricity it needs (i.e. your excess). If your system doesn’t generate enough to power your home or business, your retailer will still charge you for the additional electricity you use from the grid.

It’s not easy to say which is the best solar feed-in tariff available because they vary between retailers, states and your personal circumstances. You should always compare your options before deciding on an electricity retailer, so you can choose a tariff that’s right for you.

Keep in mind that retailers may offer you the minimum government feed-in rate, but they can also offer you higher feed-in rates. If they offer a higher solar feed-in rate, check whether they charge you more for the electricity you use from the grid. Consider the following when choosing a suitable solar feed-in tariff for you:

• What is the solar feed-in tariff rate on offer?
• How much will I be charged for electricity usage?
• How much are the daily supply charges?
• Are there any other discounts or fees on offer?

Depending on how much energy you send back to the grid, solar feed-in tariffs can have several benefits, including:

• Helping the environment by reducing greenhouse gas emissions
• Reducing electricity bills
• Being credited for the extra energy you send back to the grid.

Solar feed-in tariffs in NSW are measured by the kWh, but the rate paid varies between electricity retailers.¹ The Independent Pricing and Regulatory Tribunal (IPART) in NSW sets a benchmark rate to guide retailers, but they’re still free to set their own prices.

The benchmark flat rate for the 2023-24 financial year is 7.7 to 9.4 cents per kWh.¹

Victorian solar feed-in tariffs fall under the state’s general renewable energy feed-in tariff scheme. The Essential Services Commission – (VIC’s independent energy regulator) sets the rates.² There are currently two tariffs available in Victoria: minimum single-rate and time-varying.

All retailers must offer at least the minimum single-rate tariff, which is 4.9 cents per kWh for the 2023-24 financial year.² Retailers can also provide two options for time-varying tariffs, which pay different amounts depending on the time of day that electricity is sent to the grid.

There are two main solar feed-in tariffs in QLD, and which one you’re eligible for depends on where in the state you live.

Market feed-in tariffs

These are only available in South East QLD, where retailers can set and offer their own rates.³ Due to competition in this part of the state, it’s important to compare your options to look for the best solar feed-in tariff for your needs.

Flat rate solar tariffs

For those in regional QLD, you may be able to access these tariffs through Origin Energy or Ergon Energy.⁴ This rate is set by the Queensland Competition Authority; for regional QLD, it’s 13.441 cents per kWh for the 2023-24 financial year, which is an increase of 44.5% from the previous year.⁵

Feed-in tariffs in the ACT aren’t regulated, meaning retailers can set their own solar feed-in tariff rates.⁶ For this reason, it’s essential you compare your options, as rates can vary between retailers.

Solar feed-in tariffs in SA differ from other states and vary based on when your PV solar system was installed. Everyone in the state with eligible systems can take advantage of retailer feed-in tariffs, where retailers set their own rates, and you can select one that best suits you.⁷

If your system was connected to the grid before 30 September 2011, you can apply for the distributor feed-in tariff. This feed-in tariff is set at 44 cents per kWh and will remain until 2028, unless you upgrade or amend your solar system or move house.

In the NT, the energy market is dominated by government-owned retailer Jacana Energy. In 2020, Jacana stopped accepting customers to their premium feed-in tariff, and as of July 2022, any customers who have been on the premium residential tariff of 28.1117 cents per kWh for four years or more will be switched over to the standard feed-in tariff of 9.13 cents per kWh.⁸ Any new customers are also placed on this standard tariff.

However, there are still other retailers available, so consider comparing across the different retailers to know your options.

If you’re in WA and export electricity to the grid, you may be eligible for the Distributed Energy Buyback Scheme (DEBS). Synergy customers can receive 10 cents per kWh for electricity sent to the grid between 3pm and 9pm, or 2.25 cents per kWh for all other times of the day.⁹ DEBS rates for Horizon customers have the same peak rate, but for off-peak (9pm to 3pm) have a slightly higher rate at 3 cents per kWh.

Feed-in tariffs in TAS are regulated by the Office of the Tasmanian Economic Regulator, who set a minimum rate that retailers must credit you for the electricity you send to the grid.¹⁰ For the 2023-24 period, this rate is 10.869 cents per kWh, an increase of 22.4% from the 2021-22 financial year.

No, you must install a solar PV system before you can apply for a solar feed-in tariff. Also, remember that you won’t automatically receive a feed-in tariff when your solar PV is installed. You’ll need to contact electricity retailers for their eligibility requirements and the offers available.

Your distributor must also update your meter configuration and your network tariff in Market Settlement and Transfer solutions (MSATS) before you can start receiving the benefits of any solar feed-in tariff.

The easiest way to check which feed-in tariff you’re on is to check your bill or contact your electricity retailer. Because rates can vary between electricity retailers, it’s important to know which feed-in tariff you’re on, especially in states or territories that offer competitive markets.

Tariffs and rebates aren’t the same thing when it comes to energy. A solar feed-in tariff is the rate you’re paid per kWh of electricity your solar system exports to the grid. A solar rebate, however, usually refers to a government initiative to help you pay for your solar installation.

There used to be solar feed-in tariff schemes to encourage the export of electricity to the grid, but as the amount of solar residential customers increases, these have begun to be phased out.

In most cases, you can save money by using solar power, but there’s no guarantee. While solar power can potentially save you money, the exact figure will depend on a variety of factors. These include:

• Whether you’re on a gross or net feed-in tariff
• How big your solar system is
• How much exposure to the sun your solar system has throughout the day, as feed-in tariffs may also vary during the time of day
• The amount of electricity you use and when you use it (e.g. maximising your solar energy usage during the day and minimising your usage during evenings and nights)

The ‘Sun Tax’ is a plan for a two-way pricing system for exporting solar energy to the grid. As adoption of solar PV installations increases, as do solar exports. The issue is that the electricity network wasn’t meant to handle huge amounts of exported electricity during peak times by solar customers.

Potentially starting 2024-26 (depending on where you live), the ‘Sun Tax’ will introduce a tariff for customers who export energy to the electricity grid during peak times.

Absolutely. In fact, the Australian Energy Regulator (AER) will likely increase feed-in tariffs to encourage electricity exporting during off-peak hours. The ‘Sun Tax’ is also attempting to nudge customers into storing their energy with a solar battery storage system so customers can become more self-sustainable.

These changes are set to hopefully lower overall energy bills and improve the efficiency of the electricity grid without flooding it with energy and causing instabilities.