STCs explained. The $2,500 to $3,500 solar discount most quotes already include.

Small-scale Technology Certificates (STCs) are the federal government's mechanism for subsidising small-scale renewable energy installations: residential solar, solar hot water, small wind, and heat pump hot water. They are not a direct cash payment to the property owner. They are tradeable certificates that the installer assigns to the system owner and typically applies as a discount on the upfront price.

Almost every Australian solar installation includes STCs. The size of the discount is large enough to matter. The mechanism is invisible enough that many buyers do not realise it is there.

This post explains how STCs work, what they are worth in 2026, and how to confirm yours have been applied.

What STCs are

STCs are units issued by the Clean Energy Regulator under the Renewable Energy Target. One STC represents one megawatt-hour (MWh) of renewable energy generation or displacement of greenhouse gas emissions.

For solar:

• Each STC represents one MWh of expected generation from the system over its eligible lifetime
• The system's STC entitlement is calculated based on the system size (in kW) and the deeming period (the number of years of expected generation, currently 7-9 years depending on installation year)

For a 6.6 kW system installed in 2026 in Zone 3 (NSW coastal):

• Approximately 64-72 STCs are issued
• At current STC market price of approximately $36-42 each
• Total upfront discount: approximately $2,300-3,000

For the same system in Zone 1 (northern Australia, higher solar resource):

• Approximately 75-85 STCs issued
• Total discount: approximately $2,700-3,500

For 2027 and beyond, the deeming period reduces, gradually phasing down the STC discount over the next several years. The Federal RET scheme is scheduled to end in 2030.

How the discount works

In practice, STCs flow as follows:

Step 1: install

Your installer fits the solar system. At the moment of completion, the system is eligible to generate STCs.

Step 2: assignment

The system owner (you) assigns the STCs to the installer. This is standard practice and is the basis on which the installer prices the system "after STC" or "after rebate."

Step 3: certificate creation

The installer (or an STC trader they work with) submits the STC creation paperwork to the Clean Energy Regulator. The certificates are created in the REC Registry.

Step 4: STC sale

The installer (or trader) sells the STCs into the STC market. Buyers are typically large energy retailers who must surrender STCs to meet their renewable energy obligations.

Step 5: discount applied

The installer applies the STC value as a discount on your invoice. Net cost = total system cost - STC value.

The whole process is invisible to most buyers. You see one price (the net cost after STCs) and never interact with the certificates directly.

How to confirm your quote includes STCs

Three checks:

Check 1: line-item display

A reputable installer's quote will show the STC value as a line item. The format is typically:

• System cost (gross): $X
• Less STC discount: -$Y
• Net cost payable: $Z

If your quote shows only a single number without breakdown, ask the installer for the gross price and the STC discount separately. The $Y number should be in the $2,000-3,500 range for a typical 6.6 kW residential system in 2026.

Check 2: the assignment paperwork

You will sign an STC assignment form authorising the installer to claim the STCs on your behalf. The form discloses the number of STCs and the discount value. Read it. The numbers should match what the quote showed.

Check 3: the Clean Energy Regulator's STC database

You can verify your STC creation at the Clean Energy Regulator's REC Registry after installation. The system should appear with the correct STC count.

Common STC quote tactics

Three things to watch for:

Tactic 1: STCs deducted but a higher "gross price"

Some installers inflate the gross price so the STC discount looks larger than market reality. The net price you pay is unchanged, but the apparent saving makes the quote look more generous.

Compare net prices across quotes, not advertised "savings."

Tactic 2: STCs not deducted at all

Some less-reputable installers price the system without STCs, then claim the STC value themselves without passing it to you. This is unusual but worth checking. The Federal RET scheme is designed to pass STC value to the system owner.

Tactic 3: variable STC market price

The STC market price fluctuates. Most installers quote based on a recent market price, which may be different from the actual price at time of STC sale. Some installers pass the actual market price through, some lock in a price.

Reputable installers typically lock the STC discount in writing at the quote stage so you know exactly what you pay.

When you can claim STCs yourself

For most residential buyers, the installer claims STCs on your behalf as part of the purchase. This is the standard approach.

You can claim STCs yourself if:

• You purchase the system without using an STC-claiming installer (e.g. an owner-builder install)
• You want to retain the STCs for sale at a later date hoping for higher market price

Both pathways involve more administration and are rarely worth the effort for a single residential system.

The state-level rebates that stack with STCs

In addition to federal STCs, some states offer additional rebates that stack:

• NSW: limited solar-specific rebates in 2026, with battery-specific rebates more common
• VIC: Solar Homes program rebates, additional $1,400 for eligible households, plus interest-free loans
• WA: limited rebates
• SA: limited rebates (the legacy SA rebate scheme has wound down)
• ACT: limited rebates, primarily targeted at lower-income households

State rebates are typically capped (e.g. only available to households below certain income, only available on certain system sizes). Check your state's current scheme via Energy.gov.au.

Other STC-eligible installations

STCs are not just for solar PV. The same scheme covers:

• Solar hot water systems (typically 25-45 STCs, $900-1,800 of discount)
• Heat pump hot water (typically 25-40 STCs)
• Small wind turbines (rare for residential)
• Solar swimming pool heating in some configurations

If you are installing any eligible system, confirm the STC discount is included in your quote.

STCs are the largest single federal incentive for residential solar. They are typically already in your quote, but confirming them protects you from the small minority of installers who do not pass them on. A 60-second check on the quote can save you $2,500-3,500.