The Small-scale Renewable Energy Scheme (SRES) is a program designed to promote the adoption of small-scale renewable energy systems, specifically Solar power systems, in residential and small-scale settings. Under this scheme, homeowners and businesses that install Solar power systems with a capacity of up to 100 kW are eligible for financial incentives.
The main form of incentive provided under the SRES is the creation of Small-scale Technology Certificates (STCs). The number of STCs created for a particular system is determined by the estimated amount of electricity the system is expected to generate over a certain period, known as the deeming period. The deeming period is typically 15 years.
Once the Solar power system is installed and operational, the owner can apply to create STCs for their system. These STCs are then assigned a value, which can vary depending on market conditions. The value of STCs is determined by supply and demand dynamics in the market.
Electricity retailers in Australia are required by law to purchase a certain percentage of their electricity from renewable sources. In order to meet this requirement, retailers can purchase STCs from system owners. By buying STCs, retailers can demonstrate compliance with their renewable energy obligations.
The value of STCs can be negotiated between the system owner and the retailer, and the system owner can choose to sell them directly or engage the services of a registered agent to facilitate the sale. The financial benefit of the scheme is typically realized through the sale of STCs, which can help offset the upfront cost of installing a Solar power system.
Overall, the Small-scale Renewable Energy Scheme (SRES) aims to incentivize the adoption of small-scale renewable energy systems, particularly Solar power, by providing financial incentives in the form of STCs. This helps increase the uptake of renewable energy and contributes to reducing greenhouse gas emissions from the electricity sector.