STCs are a way for individuals and businesses to receive financial incentives for installing small-scale Solar power systems. These certificates represent the environmental benefits of generating renewable energy and can be traded in the market.
The process starts with the installation of a small-scale Solar power system, which can include Solar panels, inverters, and other necessary equipment. Once the system is installed and operational, the owner can apply for STCs.
The number of STCs received is determined by the size of the system and the location. The Clean Energy Regulator provides a calculator to estimate the number of certificates based on these factors. Generally, larger systems and regions with higher Solar radiation levels receive more certificates.
Once the STCs are obtained, they can be sold to registered agents or traders in the market. These agents or traders act as intermediaries between the system owners and electricity retailers. Electricity retailers are required to purchase a certain number of certificates to meet their renewable energy obligations, as mandated by the government.
The price of STCs can fluctuate in the market depending on supply and demand. The value of STCs can be influenced by various factors, such as changes in government policies, the overall renewable energy market, and the demand for certificates.
The revenue from selling STCs can help offset the upfront costs of installing a Solar power system, making it more affordable for individuals and businesses to transition to renewable energy. This financial incentive encourages the adoption of small-scale Solar power systems and contributes to the overall goal of reducing greenhouse gas emissions and promoting sustainable energy practices.