The value of STCs is determined by supply and demand in the market. When there is a larger supply of STCs compared to the demand, the value of each certificate decreases. Conversely, when there is a smaller supply of STCs compared to the demand, the value increases.
The size of the Solar system also affects the value of STCs. Larger Solar systems are expected to produce more renewable energy, which results in a higher number of STCs. Therefore, larger Solar systems are generally associated with a higher value of STCs.
The trading and selling of STCs provide an incentive for individuals and businesses to invest in Solar installations. By receiving a financial benefit for the renewable energy they produce, Solar system owners can offset the upfront costs of installation and make the investment more financially viable.
It’s important to note that the SRES and the STC program are specific to Australia and may differ in other countries.