The Renewable Energy Target works by allowing both large-scale power stations and the owners of small-scale systems to create certificates for every megawatt hour of power they generate. Certificates are then purchased by electricity retailers who sell the electricity to householders and businesses. These electricity retailers also have legal obligations under the Renewable Energy Target to surrender certificates to the Clean Energy Regulator, in percentages set by regulation each year. This creates a market which provides financial incentives to both large-scale renewable energy power stations and the owners of small-scale renewable energy systems.
In the case of small-scale systems, all certificates are provided ‘up front’ for the systems’ expected power generation or displacement over a 15 year period. Generally, householders who purchase these systems assign the right to create their certificates to an agent in return for a lower purchase price. The level of this benefit differs across the country depending on the level of solar radiation.
Renewable Energy Target participants who invest in, and generate, renewable energy may be eligible for financial incentives under the scheme.
These financial incentives are offered in the form of tradable certificates, which act as an electronic form of currency. Certificates, which are comprised of large-scale generation certificates, and small-scale technology certificates, are calculated on the amount of renewable energy which is generated or displaced from a system or power station. For example, one certificate can be created for each megawatt hour (MWh) of electricity generated.
Learn how to claim small-scale technology certificates yourself, or assign the right to create them for an upfront financial benefit.
To find out if you are eligible for a feed-in tariff, you will need to contact your state or territory government, or electricity retailer who will provide you with further information, and if you are eligible, will help you apply.
State and territory Governments regulate and oversee the administration of feed-in tariffs, which may vary depending on where you live. Contact your state or territory Government to find out more information about feed-in tariffs in your area.
Accredited renewable energy power stations are entitled to create large-scale generation certificates for all eligible electricity generated above a regulated level, called the baseline. Once created, large-scale generation certificates can be sold to offset the cost of investment, or if you are a liable entity, surrendered to the Clean Energy Regulator to meet your liability obligations.
Learn how to gain accreditation for a renewable energy power station and how to calculate financial incentives you may be eligible for.
Through the scheme, large renewable power stations and the owners of small-scale systems are eligible to create certificates for every megawatt hour of power they generate—creating the ‘supply’ side of the certificate market. Wholesale purchasers of electricity, mainly electricity retailers, buy these certificates to meet their renewable energy obligations—forming the ‘demand’ side of the certificate market. Wholesale purchasers of electricity then surrender these certificates to the Clean Energy Regulator in percentages set by regulation each year.
Certificates are traded and paid at a rate determined by supply and demand of the market.
Small-scale renewable energy systems and large-scale renewable energy power stations can be used to generate power for our community, homes and businesses from sustainable natural resources, such as the sun, wind and water.
Participants who are required by law to surrender large-scale generation certificates and small-scale technology certificates to offset the generation of emissions intensive energy, and meet scheme compliance obligations.
The Small-scale Renewable Energy Scheme encourages investment in small-scale renewable energy, and creates a financial incentive for individuals and small businesses to install systems which produce electricity and deliver hot water.
To participate in the Small-scale Renewable Energy Scheme, individuals and small businesses must choose and install a renewable energy system which meets the scheme’s eligibility criteria.
Learn more about eligible small-scale systems and using a registered agent. Under the Small-scale Renewable Energy Scheme, retailers, traders and installers of small-scale systems may also apply to the Clean Energy Regulator to become a registered agent.
Once registered with the Clean Energy Regulator, agents can assist owners in the purchase and installation of their system, and create and sell assigned small-scale technology certificates.
The Large-scale Renewable Energy Scheme creates a financial incentive for the establishment and growth of renewable energy power stations, such as wind and solar farms, or hydro-electric power stations.
To participate under the Large-scale Renewable Energy Scheme, renewable energy power stations must generate electricity from eligible natural resources such as the sun, wind, ocean waves and the tide, geothermal-aquifers, wood waste, agricultural waste, bagasse (sugar cane waste), black liquor (a by-product of the paper-making process), or landfill gas.
A full list of eligible renewable energy sources is in the Renewable Energy (Electricity) Act 2000—the legislation which underpins the Renewable Energy Target.
Renewable energy power stations that meet the eligibility criteria and become accredited under the scheme are entitled to create large-scale generation certificates—which can be sold and traded to off-set the cost of investment.
The Large-scale Renewable Energy Target also imposes a legal obligation on liable entities to buy and surrender certificates to the Clean Energy Regulator on an annual basis. The amount of certificates liable entities are required to surrender to meet their legal obligation is determined through the small-scale technology percentage and renewable power percentage.
Learn how to gain accreditation for a renewable energy power station under the Large-scale Renewable Energy Target, buying and selling large-scale generation certificates, and surrendering large-scale generation certificates to meet scheme compliance obligations.
Under the Small-scale Renewable Energy Scheme, eligible small-scale renewable energy systems are categorised into small generation units and solar water heater systems.
Before you purchase and install a system it is important that you do your research to find the system which best suits your needs, and make sure you, or your agent, check your system is eligible under the Small-scale Renewable Energy Scheme.
If the small-generation unit is larger than the capacity limits listed above, it will be classified as a power station and must be accredited as a power station under the Large-scale Renewable Energy Target. If accreditation is successful, the unit may be eligible for large-scale generation certificates.