Under the SRES, solar power system owners are issued with Small-scale Technology Certificates (STCs) for the amount of electricity the system is expected to generate over a set period (usually 15 years). These STCs can be sold to energy retailers, who are required by law to buy a certain amount each year. The value of the STCs varies depending on factors such as the size of the system and the location.

The purpose of this system is to incentivize the installation of Solar power systems by providing a financial benefit to homeowners. By selling their STCs, homeowners can recoup some of the cost of installing the system, making Solar power more affordable and attractive.

Energy retailers are required to purchase STCs in order to meet their Renewable Energy Target obligations, which aim to increase the amount of renewable energy in Australia’s electricity generation mix. This helps to reduce greenhouse gas emissions and combat climate change.

Overall, the Small-scale Renewable Energy Scheme helps to support the growth of the Solar power industry in Australia and promote the transition to a cleaner, more sustainable energy future.