How your business could benefit from creating Small-scale Technology Certificates (STCs)

STCs: Tradeable certificates that are created under the Small-scale Renewable Energy Scheme (SRES) which create a financial incentive for installing solar power and other renewable energy systems.

Under SRES, customers who install eligible systems are eligible to have Small-scale Technology Certificates (STCs) created based on the type and size of the system, the installation date, output of the system and its location. The SRES scheme provide financial incentives for businesses to install rooftop solar and other renewable energy systems. Once STCs have been created, they can be sold to electricity retailers like Shell Energy, or other ‘liable entities’, that need to purchase certificates to meet their own renewable energy target obligations.

What is an STC and how do they work?

STCs are created under the Renewable Energy Target scheme, which is an Australian Government scheme designed to reduce emissions of greenhouse gases in the electricity sector and encourage the additional generation of electricity from sustainable and renewable source. STCs can be created by installing qualifying renewable energy systems, with one STC representing one megawatt hour (MWh) of electricity generated or displaced.

While STCs are most commonly created following installation of solar PV, heat pumps, solar hot water, micro-hydro and small wind systems can also qualify. The total number of certificates that can be created for an eligible small-scale renewable energy system is determined by geographical location, the amount of electricity it generates and the date of installation.

If you install an eligible small-scale renewable energy system, you may be able to recover some of your financial outlay through selling or assigning the right to create STCs. STCs are created upfront for the renewable energy your system is expected to produce, starting from the year the system is installed until the scheme ends in 2030.

STCs and solar projects: could it work for you?

STC eligibility is determined by various requirements covering classification, installation, certification and compliance. To be eligible to create Small-scale Technology Certificates, the unit must have Clean Energy Council-approved components that meet Australian and New Zealand standards, use an accredited designer and installer, follow specified guidelines, and adhere to the relevant small-scale classification requirements.¹ This includes:

• an air source heat pump with a capacity of no more than 425 L; and
• a solar system with a 99.9 kW maximum capacity and annual electricity output less than 250 MWh

Hydro systems and wind systems may also qualify for STCs. You can read more about the requirements on the Clean Energy Regulator website²

Expanding, upgrading or replacing eligible systems may also qualify to create STCs under the scheme, so if you’re considering making changes to your on-site generation, compare the benefits and costs involved in installing a new system versus expanding your current system.

Shell Energy can incorporate the value of STCs into larger energy solutions projects. To learn more about environmental certificates, including Large-scale Generation Certificates (LGCs), visit our website.

References
¹ https://www.cleanenergyregulator.gov.au/RET/Scheme-participants-and-industry/Agents-and-installers/Small-scale-systems-eligible-for-certificates
² https://www.cleanenergyregulator.gov.au/RET/Forms-and-resources/Renewable-Energy-Target-FAQs