Small-scale Technology Certificates (STCs) are the mechanism behind the "solar rebate" and the federal home battery discount. They are not a cash grant paid by the government. When an eligible system is installed, the scheme allows a set number of certificates to be created, based on the renewable electricity a solar system is expected to generate or, for a battery, its usable capacity. The certificates are tradeable. Installers usually take them in exchange for a discount at the point of sale and sell them on, and they are eventually bought and surrendered by electricity retailers and other liable entities that are legally required to hold them. Here is how that chain works.

The scheme at a glance

STCs are created under the Small-scale Renewable Energy Scheme, administered by the Clean Energy Regulator, and the scheme runs to 2030. It covers small solar systems, solar water heaters and heat pump water heaters, and, through the Cheaper Home Batteries Program, home batteries installed with solar. A certificate for solar generation represents one megawatt-hour of renewable electricity. Official details are on the Clean Energy Regulator's Small-scale Renewable Energy Scheme page, and related terms are defined in the solar technology glossary.

Step 1: Deeming, and how many certificates a system earns

Instead of rewarding electricity year by year as it is generated, the scheme estimates it upfront. This is called deeming. For solar panels, the number of STCs depends on three factors:

• System size in kilowatts.
• The postcode zone rating, which reflects how much sunshine a location typically receives. Sunnier zones earn more certificates for the same system.
• The deeming period, the number of years credited in advance, counted to the end of the scheme in 2030.

Multiplying size, zone rating and deeming years, then rounding down, gives the certificate count. Because the scheme ends in 2030, the deeming period shortens every 1 January, so the same system earns fewer certificates each year. As a reference point, STCs take roughly $1,700-$1,800 off a typical 6.6 kW system installed in 2026.

Batteries use a different calculation. Certificates are based on usable capacity, with a per-kWh value that steps down every 1 January and 1 July to 2030. The discount works out at roughly 30% of the installed cost, tiered at approximately $272 per kWh for the first 14 kWh, $163 per kWh from 14 to 28 kWh, and $41 per kWh from 28 to 50 kWh. The battery must be on the approved products list and installed with solar, either existing or new at the same time.

Step 2: Installation, paperwork and creation

1. Accredited design and installation. The system must be designed and installed by an installer accredited with Solar Accreditation Australia, using approved equipment.
2. Assignment of rights. The owner signs a form assigning the right to create the certificates, usually to the installer's registered agent, in return for the point-of-sale discount.
3. Evidence. The installer supplies supporting records, such as equipment serial numbers, the electrical compliance certificate and signed declarations from the installer and designer.
4. Creation and validation. The registered agent creates the certificates in the Clean Energy Regulator's online registry, where they are checked before they become valid and tradeable. The regulator also inspects a sample of installations.

Certificates must be created within a limited time after installation, which is one reason the paperwork is normally handled by the installer rather than the owner.

Step 3: The open market and the clearing house

Once validated, STCs can be sold through two routes:

Most certificates are traded on the open market. The clearing house effectively acts as a ceiling on the open-market price, because liable entities have little reason to pay more elsewhere while certificates are available at the fixed price. The market price at the time an installer prices a job largely determines the discount shown on the quote.

Step 4: Liable entities and surrender

Demand for STCs comes from liable entities, mainly electricity retailers, along with some large energy users that buy electricity directly from the wholesale market. Each year the regulator sets the small-scale technology percentage, which determines how many certificates each liable entity must surrender in proportion to the electricity it acquires. Liable entities surrender certificates to the regulator quarterly, and every surrendered certificate is permanently retired.

Because retailers must buy these certificates, the cost is spread across electricity bills generally. In effect, the scheme shifts part of the upfront cost of small-scale renewable systems from individual buyers to the wider electricity market.

Why the value steps down, and what to check

The discount on a quote can change for several reasons, some scheduled and some driven by the market:

• Scheduled step-downs. The solar deeming period shortens each 1 January, and the battery value per kWh falls every 1 January and 1 July to 2030.
• Market price. The open-market STC price moves with the balance between certificates created and certificates liable entities need.
• Installation date. Certificate numbers depend on when the system is installed, not when the quote is signed, so a job that slips past a step-down date can attract a smaller discount.

Because values step down, always confirm current figures on the official pages before signing. Policy changes are also summarised in industry news and policy updates.

Next steps

Two services on the energy market cover the certificate side of a project: Solar Rebate (STC) Assessment & Processing ($49 per system, at no charge with a Blue Energy Solar installation) confirms eligibility and value, and the Battery Incentive Assessment ($99 per property) checks the federal battery discount and related NSW incentives. Prices are indicative and confirmed after a site assessment. To see how certificates apply to a system on your home, request a free assessment from Blue Energy Solar.

Frequently asked questions

Can a homeowner create and sell their own STCs?

It is possible for an owner to register with the regulator, create certificates and sell them, but it involves an online registry account, supporting evidence, validation and finding a buyer or waiting in the clearing house queue. It also means paying the full system price upfront. Most owners assign their certificates to the installer's registered agent and receive the value as a point-of-sale discount instead.

Do STCs stack with NSW battery incentives?

For most households, not at the moment. The NSW household battery installation incentive under the Peak Demand Reduction Scheme has been suspended since 30 June 2025, apart from approved exempt programs. Separately, from 1 July 2026 NSW offers a one-off incentive of up to $1,000 for connecting an existing battery to a virtual power plant. Confirm current rules on the official NSW energy website.

Why can two quotes show different STC discounts for the same system?

Installers price certificates at slightly different values, depending on the market price when they quote, how they allow for price movements before they sell, and how they present GST. Expected installation date also matters, because a step-down can reduce the certificate count. Comparing total price after the discount is more reliable than comparing the discount line alone.