A comparison of solar feed-in tariffs

The short answer is yes – solar is still a great way for Australian households to save on electricity – but only if you know how to find a good deal.

Most electricity retailers these days offer competitive feed-in tariffs as part of their standard product range. Some even have products specifically designed for customers with solar panels. Solar products are slightly different to standard electricity deals. While you are still charged for electricity usage and supply, you will also receive something called a feed-in tariff. In this article, Canstar Blue explains and compares feed-in tariffs across leading Australian retailers. We also look at what else customers should consider to find the best solar deal.

What is a feed-in tariff?

A feed in tariff (FiT) is a small credit rebate that households receive for any excess electricity produced by a solar system or other small-scale generator. Simply put, unless you have a solar battery, any solar power produced by solar panels must be immediately used or it will feed in to the shared electricity grid for other properties to use. For each kilowatt hour (kWh) of electricity that a household’s solar system exports to the electricity grid, that property will receive a feed-in tariff of a few cents, usually between 7 and 16 cents per kWh. Feed-in tariffs are not paid out cash in hand, rather they apply as a deduction on your regular bill. A high feed-in tariff can help drastically reduce what you pay for electricity, that’s why it’s so important to shop around for solar deals.

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List of feed-in tariffs in Australia

Feed-in tariffs vary markedly across states and retailers. Below is a state-by-state breakdown of the largest (non-premium) feed-in tariffs offered by leading retailers.

NSW solar feed-in tariffs

The table displays the maximum feed-in tariff offered by each listed retailer at the time of writing.

The New South Wales regulator recommends a feed-in tariff of at least 6.9c/kWh, however as you can see, not all retailers follow this suggestion. Most of the better known retailers in the state do not have any specialised solar products, while the few companies that do often have much higher feed-in rates than their competitors.

Queensland solar feed-in tariffs

The table displays the maximum feed-in tariff offered by each listed retailer at the time of writing.

Aside from Ergon Energy, all Queensland retailers have free reign to set their own feed-in tariffs. The largest FiT on offer by a long shot comes from Sanctuary Energy.

South Australia solar feed-in tariffs

The table displays the maximum feed-in tariff offered by each listed retailer at the time of writing.
South Australia has had quite a surge in feed-in tariff rates recently. Most retailers now offer FiTs upward of 15c/kWh, although it seems Alinta, Sanctuary and Dodo didn’t get the memo.

Victoria solar feed-in tariffs

The table displays the maximum feed-in tariff offered by each listed retailer at the time of writing.

Victoria is the only state to impose a legal minimum feed-in tariff on a competitive energy market. As of July 2017, the minimum FiT is 11.3c. As you can see, most retailers simply offer the bare minimum. The few retailers with special solar deals offer a few cents more however. The minimum flat-rate FiT will fall to 9.9c/kWh on July 1 2018. This cut will also be accompanied by the introduction of time-varying FiTs. Under new laws, all retailers must offer either a single rate FiT, time-varying FiT, or both.

Can I receive a premium solar feed in tariff?

You may have heard about feed-in tariffs as high as 60c/kWh. Sounds nice right? Unfortunately these premium solar feed-in tariffs are only available to homeowners who installed and registered their solar systems many years ago – generally before 2011, depending on the state. This means you are not eligible for a premium tariff if you’ve only installed solar in the past few years or plan to do so shortly.  Unfortunately, there’s no sign of any new solar bonus schemes in the near future.

Queenslanders and South Australians who signed up to a solar bonus scheme before they closed will continue to receive a premium tariff until 2028. Victorian bonus scheme customers will also receive their premium FiT until 2024. Unfortunately for New South Wales solar bonus customers, the scheme came to its scheduled conclusion at the end of 2016 and all customers were reverted to a standard rate.

Should I choose a larger discount or higher FiT?

Some retailers, such as Origin Energy and Click Energy, have multiple offers for customers with solar panels. Its range of products might include a deal with a high feed-in tariff and low discount, a deal with a low feed-in tariff and high discount, and sometimes, an offer somewhere in between.

So which should you choose, the better FiT or larger discount? Unfortunately the answer isn’t clear and it will depend on your personal circumstance. Consider the following points.

Consider choosing the higher FiT if…

• You have a large solar system (5kW or more)
• A lot of solar is exported to the grid from your house because no one is home during the day to use it
• There are conditions attached to receiving the discount which you’re not sure you can meet

Consider choosing the higher discount if…

• You have a small solar system (less than 5kW)
• You use most of your solar power through the day and export very little to the grid
• You own a solar storage battery

Solar monitoring technology can give you insights into your electricity usage habits and help you make a better informed decision about which plan is best suited for your home.

How to find a good deal on solar

A large feed-in tariff is definitely nice, but you shouldn’t just assume a bigger feed-in tariff means it’s a better deal. You should always look at the energy price factsheets when comparing electricity products. Keep an eye out for ‘solar metering charges’. These are daily fixed charges that certain retailers apply to solar customers. It’s also not uncommon to find solar products with large feed in tariffs charging higher electricity usage or supply rates, so you need to consider if the trade-off is worth it.

If you have a large solar system, say 5kW or over, then you will most likely be better off on a deal that provides a high feed-in tariff, even if it means slightly higher electricity usage rates. A bigger feed-in tariff may also be attractive for households that are hardly home during the working day to use their solar power and consequently have most of it exported to the energy grid. Conversely, customers with small solar systems or a storage battery probably won’t export much solar to the grid and should focus on cheap electricity rates over feed in tariffs. The same applies if you’re home during the day and tend to use up all your solar power.

Now while rates are important, so is customer service. If you truly want to make the most from your investment in solar, you need an energy retailer that will help you at every step of the process. To see which solar energy companies are meeting customer expectations, check out Canstar Blue’s solar provider customer satisfaction ratings.

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