STCs are essentially a way to encourage the adoption of renewable energy systems by providing a financial benefit to individuals or businesses that install these systems. The more renewable energy a system is expected to generate, the more STCs it will be eligible for. This means that larger systems or systems in areas with higher Solar radiation will receive more STCs.
Once a system is installed and meets the eligibility requirements, the owner can create STCs based on the amount of renewable energy the system is expected to generate over its lifetime. These STCs can then be sold or traded on the open market. The price of STCs can fluctuate depending on supply and demand, but generally provides a financial benefit to the system owner.
By providing this financial incentive, the government aims to reduce the upfront cost of installing renewable energy systems and make them more accessible to a wider range of individuals and businesses. This helps to increase the uptake of renewable energy, reduce greenhouse gas emissions, and contribute to the transition to a more sustainable and clean energy future.