In short
- STCs are a government discount that comes off your solar price upfront.
- A bigger system in a sunnier place gets a bigger discount.
- From 1 October 2026, systems up to 1 MW can get it. The old limit was 100 kW.
STCs, or small-scale technology certificates, are the main reason business solar costs less than the equipment's sticker price. Your installer claims them and takes their value off your invoice. From 1 October 2026, much bigger systems qualify, which changes the sums for many mid-sized businesses.
| Quick facts | |
|---|---|
| What it is | An upfront discount on your solar price, paid through certificates |
| Who claims it | Usually your installer, who takes it off your invoice |
| What sets the amount | System size, your postcode and the year you install |
| Who qualifies | Systems up to 100 kW, and from 1 October 2026 systems up to 1 MW |
| When 100 kW to 1 MW claims open | Not before mid to late November 2026 |
| When the scheme ends | 2030 |
In plain words: the discount is real money off your quote, and more businesses can now get it.
What is an STC, and how does it cut my solar price?
An STC is a certificate your solar system creates when it is installed. Each one stands for one megawatt hour of clean power the system is expected to make. That's 1,000 kWh, the same units you see on your power bill.
The scheme is run by the Clean Energy Regulator, the government body in charge. It winds down to 2030.
Your system gets all its certificates upfront, based on how much power it should make over a set number of years. Energy retailers must buy these certificates each year. That is what gives them a cash value.
In practice you never touch them: your installer (or an agent working with them) claims the certificates and takes their value off your price. The discount should show on your quote as its own line.
How many STCs will my system get?
For solar panels, it's three numbers multiplied together:
system size (kW) × zone rating × number of years
System size is in kW (kilowatts). The answer is rounded down to a whole number of certificates.
Your zone rating depends on how sunny your postcode is. The regulator splits Australia into four zones. Sunnier zones get more certificates for each kW.
| Zone | Rating | Example areas (by postcode) |
|---|---|---|
| 1 | 1.622 | Alice Springs area (postcodes 0870–0879) |
| 2 | 1.536 | Darwin (postcodes 0800–0853) |
| 3 | 1.382 | Sydney, Brisbane, Adelaide, Perth, Canberra |
| 4 | 1.185 | Melbourne, Hobart |
In plain words: a Brisbane business gets more per kW than a Melbourne one. Zones follow postcodes, not city names, so check yours on the regulator's zone table.
The number of years depends on when you install. For systems up to 100 kW, it drops by one each year until the scheme ends.
| Year installed | Years counted (systems up to 100 kW) |
|---|---|
| 2026 | 5 years |
| 2027 | 4 years |
| 2028 | 3 years |
| 2029 | 2 years |
| 2030 | 1 year |
In plain words: a smaller system gets a smaller discount for every year you wait.
What changes on 1 October 2026?
New rules made in September 2026 open STCs to bigger systems. Solar systems over 100 kW and up to 1 MW, installed from 1 October 2026, can now create STCs. One MW (megawatt) is 1,000 kW.
- Installed before 1 October? A system over 100 kW installed before that date still misses out.
- Five years, every year. Systems in this range count five years for each year to 2030. A 400 kW system installed in 2028 still counts five years.
- The whole site counts. The 1 MW limit counts all the solar on the site. New panels, or a second system beside an old one, can't take the total past 1 MW.
- Claims open later. Applications will not open until mid to late November 2026, once the regulator's systems are ready. You can install from 1 October, but you can't claim certificates before then.
Before this change, systems over 100 kW got no upfront discount. They earned a different kind of certificate instead, bit by bit as the system made power. That still applies to systems over 1 MW.
How much could the discount be worth?
Here's an example, for illustration only. Take a 500 kW system in Sydney (zone 3, rating 1.382), installed in November 2026:
500 × 1.382 × 5 = 3,455 STCs
What they are worth depends on the certificate price on the day they are sold. Most are sold on the open market, where the price moves daily. The regulator reported it close to $40 through mid-2026, at $39.85 on 30 June 2026.
There is also a government clearing house that pays a fixed $40 per certificate (excluding GST). But sellers there can wait for a buyer.
At those prices, the certificates would be worth roughly $135,000 to $138,000, before any installer fees for handling them. Treat any price as a snapshot, not a promise.
Compare a 99 kW system in the same postcode. Installed in 2026, it gets 684 STCs. Installed in 2027, it gets 547.
Should my business now go bigger than 100 kW?
Many businesses used to stop at 99 or 100 kW to keep the discount, even when their roof could take more. From 1 October 2026, going over 100 kW no longer costs you the discount.
The right size still comes down to three things:
- How much power you use in the day. Solar pays back best when you use the power yourself. Power you send back to the grid earns much less than the price you'd pay to buy it.
- Grid limits. A bigger system may need approval from your local network, or a cap on what you send back. This can affect timing and design.
- What's already on your roof. The 1 MW limit counts everything on the site, so an existing system leaves less room.
More on cost and payback in commercial solar cost, and on approvals in commercial solar installation.
Can I get state rebates as well?
STCs are national, and some states add their own incentives. Victoria's VEU program, for example, gives an upfront discount on commercial solar between 30 and 200 kW. Its value moves with certificate prices.
What you can combine depends on the program rules and your site. Our commercial solar rebates page covers this state by state.
If your bill has demand charges, size and timing matter for a second reason. See demand charges: what they are and how to cut them.
What to ask your installer
- Is the STC discount shown as its own line on my quote?
- What certificate price have you assumed, and are there fees for handling the certificates?
- Does my site need a network application, and who handles it?
- Will the power I send back to the grid be limited?
- I already have solar. How much room is left under the 1 MW limit?
- For a system over 100 kW: will you give me the written installer statement? (Designer and retailer statements aren't needed at this size.)
- When will the discount apply, given claims don't open until mid to late November 2026?
Getting the size right is the hard part, and it starts with how your site uses power.
If you upload a recent electricity bill, an accredited installer prepares a costed proposal for your site. It shows the STC discount as its own line and sizes the system to your actual use, not the old 100 kW cut-off. It's free, and there's no obligation.