subject: Solar Hot Water Rebates: How to Calculate Your Cashback [print this page] So high school maths was useful after all...
The Victorian and federal governments recently made some big changes to the way that solar hot water rebates are calculated ... and they definitely weren't aiming to make the system simpler! While owners are now more fairly compensated for installing higher-capacity and more energy efficient solar hot water systems, the system for working out how much cashback homeowners get is no longer a simple single-figure process. Today we go back to high school to find out how to calculate your solar hot water rebate, and discover that they were right when they said that you'd use maths again in adulthood ...
The Renewable Energy Bonus Scheme
The Renewable Energy Bonus Scheme is fairly simple. It offers a rebate of $1000 for a solar hot water system installation that meets the below conditions, and $600 for a heat pump hot water system. To be eligible, your solar hot water must:
Be replacing an existing electric water heater - not a gas system
Be installed in a dwelling that has not received insulation installation assistance through the Home Insulation Program - yes, it seems that the government only wants you to be 'so green, but no greener'!
Be installed by a qualified electrician and/or plumber
Generate 20 or more Renewable Energy Certificates (RECs) ... this is where the process gets a little more complicated.
The rebate from the Renewable Energy Bonus Scheme is paid as a direct credit to your nominated bank account, whereas RECs (see below) are provided as a Point of Sale discount.
Renewable Energy Certificates (RECs)
Renewable Energy Certificates attempt to determine in real terms how much non-renewable energy a solar hot water system is replacing. The requirement that a solar water heater have at least 20 RECs attached helps to ensure that systems have a high enough capacity to ensure that you won't need to use the electric boost button (which can actually be a lot more wasteful than a standard electric water heater!).
Solar hot water installers can tell you how many RECs your system is entitled to at the time of purchase - they'll need your postcode to work out this information. If you aren't advised, you can work them out using this method:
Determine which solar zone you are located in using the government chart
Find the solar hot water register available from the Office of the Renewable Energy Regulator (www.orer.gov.au) - there are separate documents available for models with less than 700L capacity and more than 700L capacity.
Find your solar hot water model brand and model number
Check that your installation date is applicable using the column on the chart
Look under the column for your postcode zone to see how many RECs are applicable for your system
All solar hot water Melbourne systems will have a postcode zone of 3 or 4. Even at these low solar energy levels, there are plenty of systems that provide over 20 RECs; many systems actually provide over 30. However, there are also quite a few systems that have only 10, 13, 16 or 18 RECs attached to them, so don't assume that you'll be eligible for the rebate simply because you're installing solar hot water. Your retailer can help.
RECs themselves can have a financial benefit attached. When you get a discount on your system for RECs, you are assigning them to the retailer as your agent, who will then on-sell them in the REC marketplace.
You can also sell your RECs yourself by becoming a registered person in the REC registry; the purchaser of your RECs will most likely be a standard energy producer who must purchase a certain amount in order to acquit their legal responsibilities. This option involves more paperwork, but may get a you a slightly higher price for your RECs. You can find the current REC prices here: http://www.greenenergytrading.com.au/rec-prices.html. Currently, on a 31 REC-eligible solar hot water system, you would get around $1100 for your RECs.
Solar Hot Water Rebates: How to Calculate Your Cashback
