How STCs work in Perth: the point-of-sale solar discount explained

When Perth solar installers quote a system price, that price typically already reflects a discount from Small-scale Technology Certificates (STCs). STCs are a Federal government subsidy that reduces the upfront cost of solar. Understanding how they work explains why solar quotes change year to year — and what happens to the discount as 2030 approaches.

What are STCs?

STCs (Small-scale Technology Certificates) are created when a solar system is installed. Each STC represents 1 megawatt-hour (MWh) of renewable energy generated or displaced. When you install a solar system, your installer creates STCs on your behalf and sells them on the STC market. The cash proceeds from that sale are passed to you as a discount on the system price.

In practice, you never see the STC transaction — the installer creates and sells the STCs, deducts the proceeds from your invoice, and you pay the reduced price. The STCs are the "solar rebate" many Perth households have heard about.

How many STCs does a Perth system get?

The number of STCs depends on:

1. System size (in kW): Larger systems create more STCs
2. Deeming period: The number of years of generation that are "deemed" in advance
3. Zone: Perth is in Zone 3, which has a zone rating of 1.382

The formula: STCs = System size (kW) × Zone rating × Deeming period

Example for a 10kW system installed in 2026 (deeming period: 5 years): STCs = 10 × 1.382 × 5 = 69.1 STCs (rounded to 69)

At an STC spot price of approximately $36–$38 (as of mid-2026), 69 STCs × $37 = approximately $2,553 as the STC-derived discount.

For a 6.6kW system in 2026: STCs = 6.6 × 1.382 × 5 = 45.6 ≈ 45 × $37 = approximately $1,665 discount.

Why the deeming period decreases each year

The STC scheme runs from 2001 to 2030. In the early years of the scheme, the deeming period was very long (15 years), creating a large number of STCs and a large upfront discount. The scheme is designed to taper off — each year, the deeming period decreases by one.

| Year | Deeming period | STCs for 10kW system (Perth) | |---|---|---| | 2024 | 7 years | 10 × 1.382 × 7 = 96.7 | | 2025 | 6 years | 10 × 1.382 × 6 = 82.9 | | 2026 | 5 years | 10 × 1.382 × 5 = 69.1 | | 2027 | 4 years | 10 × 1.382 × 4 = 55.3 | | 2028 | 3 years | 10 × 1.382 × 3 = 41.5 | | 2029 | 2 years | 10 × 1.382 × 2 = 27.6 | | 2030 | 1 year | 10 × 1.382 × 1 = 13.8 | | 2031 | 0 | No STCs |

The deeming period reduces each 1 January. This is why solar installers and analysts sometimes say "buy before 1 January" — the STC discount reduces at the turn of the year.

At $37/STC, the annual deeming-period reduction costs: (10 × 1.382 × 1) = 13.82 STCs × $37 = approximately $511 for a 10kW system. This is the theoretical financial incentive to buy before January 1 rather than after. In practice, the installer market adjusts pricing to reflect the lower STC component, so the actual post-January price difference is visible in quotes.

Why STC prices fluctuate

STCs trade on a market (the STC Clearing House, run by the Clean Energy Regulator). The Clearing House buys STCs at a fixed price of $40, but the open market price is lower (typically $35–$39) because installers and aggregators sell before the Clearing House for faster payment.

STC market prices fluctuate based on supply (how many STCs are being created, driven by solar installation volumes) and demand (how many liable entities — electricity retailers — need to purchase them). When solar installation volumes spike, STC prices can soften as supply increases.

For Perth households: The STC discount shown in your quote is locked in at the time of contract. If STC prices change between your quote and installation, the difference is typically absorbed by the installer (most installers guarantee the STC value at signing).

The STC transaction: what happens behind the scenes

1. You sign a contract for a solar system at a quoted price that includes an STC discount
2. Your installer (or an aggregator) creates the STCs through the Clean Energy Regulator's REC Registry after installation
3. The STCs are sold on the open market or to the Clearing House
4. The proceeds offset your invoice — you pay the net price

You don't need to do anything with STCs. The installer handles the entire process. Your responsibility is to confirm that the system was installed by a CEC-accredited installer (required for STC eligibility) and that the paperwork is completed.

STCs end on 31 December 2030

The Small-scale Renewable Energy Scheme (SRES) — the program under which STCs are created — is legislated to end on 31 December 2030. From 1 January 2031, there will be no federal STC discount on new solar installations.

What this means:

• Systems installed in 2030 receive STCs for one deeming year (2030)
• Systems installed after 31 December 2030 receive no federal subsidy
• The reduction in upfront subsidy will likely increase system prices for consumers who install after 2030

Is there a federal replacement program? As of mid-2026, no replacement for the SRES has been legislated. The WA Battery Incentive ($130/kWh) is a state-level program that is independent of the federal STC scheme and has no stated 2030 end date.

STCs reduce the upfront cost of Perth solar by several thousand dollars — approximately $1,600 for a 6.6kW system and $2,500 for a 10kW system in 2026 (at current STC prices). The deeming period decreases by one each 1 January, reducing the discount annually until the scheme ends on 31 December 2030. STCs are handled entirely by your installer — you pay the discounted price and the installer processes the certificate transaction.