Solar Feed-In Tariffs: What You Need To Know

Last updated: January 2024
Reading time: 4 minutes

Across Australia, there are different financial incentives to help homeowners switch to solar. From rebates to loans, these programs are designed to reduce the cost of installing rooftop solar.

One incentive available across the country is the solar feed-in tariff, which can help offset the cost of solar on an ongoing basis and help to reduce system payback times.

In this article, we’ll cover everything you need to know about solar feed-in tariffs and help you find the best rate for your location.

What’s on this page

graphic showing electricity going back to the grid in exchange for a financial credit

What is a Solar Feed-in Tariff?

A solar feed-in tariff, also known as the solar bonus scheme or solar buy-back scheme, is a credit you receive for the excess solar energy generated by your system that is exported to the grid.

Feed-in tariffs can be regulated by government, or offered by electricity retailers.

How Do Feed-in Tariffs work? Why export energy?

Sometimes, your solar panels produce more energy than you need to power the appliances in your home directly. This energy must go somewhere, so unless your solar system includes battery storage, it’s sent back to the grid for others to use.

Nearly all system are configured to work this way, it is called net metering.

Feed-in tariffs are paid as a credit on your electricity bill, providing a long-term, ongoing kickback to help you pay back your solar system.

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State-by-State Solar Feed-in Rates

Feed-in tariff rates differ from state to state. Some state governments set the rates, while in other states, including NSW, and QLD it’s up to the energy retailers to set a competitive market price.

The table below shows feed-in tariffs for each Australian state and territory:

vicnswqldsawatasactnt
State: Retailer: Min FiT: Max FiT:
Victoria AGL 4.9c 15.0c
Victoria Energy Australia 5.4c 5.4c
Victoria 1st Energy 4.9c 9.9c
Victoria Origin Energy 4.9c 20.0c
Victoria Simply Energy 4.9c 4.9c
Victoria Not listed 5.0c 5.0c
NSW AGL 7.0c 15.0c
NSW Energy Australia 7.6c 7.6c
NSW Red Energy 6.0c 12.0c
NSW Origin Energy 7.0c 20.0c
NSW Powershop 5.0c 5.0c
NSW Simply Energy 5.5c 5.5c
QLD AGL 5.0c 15.0c
QLD Red Energy 5.0c 16.0c
QLD Energy Australia 6.6c 6.6c
QLD Simply Energy 5.5c 5.5c
QLD Origin Energy 5.0c 20.0c
SA AGL 6.0c 6.0c
SA Energy Australia 8.5c 8.5c
SA Momentum Energy 3.5c 3.5c
SA Origin Energy 6.0c 20.0c
SA Simply Energy 5.5c 5.5c
TAS Aurora Energy 10.9c 10.9c
TAS Not listed 10.9c 10.9c
ACT Actew AGL 10.0c 15.0c
ACT Energy Australia 7.6c 12.0c
ACT Origin Energy 8.0c 12.0c
ACT Energy Locals 7.1c 7.1c
ACT Red Energy 6.0c 6.0c
NT Rimfire Energy 11.0c 11.0c
NT Jacana Energy 8.3c 8.3c

How do Current Rates Compare to Historical Rates?

The value of feed-in tariffs has decreased over the years.

Typically, feed-in tariff rates reflect wholesale electricity prices and the demand for energy at a particular time of day. Most solar energy is exported to the grid during the middle hours of the day when wholesale prices and energy demand are low. Only 0.5% of solar energy is exported after 5pm when energy demand is high 1.

This large difference between solar exports and wholesale prices – illustrated on the graph below – explains why feed-in tariff rates are lower than they used to be.

The Solar Duck Curve graph shows average solar exports and the average wholesale electricity prices for 2022 and 2023 for every hour of the day

Solar Duck Curve Graph showing average solar exports vs wholesale electricity prices 2

This trend is likely to continue: as more homes switch to solar, more energy will be exported to the grid when household consumption is typically low, driving a further gap between solar energy exports and wholesale prices.

How to Manage Feed-in Tariffs: Self Consumption vs Exporting Energy

With this gradual reduction in feed-in tariff rates, we wouldn’t advise homeowners to install an excessive solar system with the plan to profit from their excess energy.

It is much better to self-consume your solar power rather than export it back to the grid in return for a feed-in tariff. You pay a much higher rate when you buy electricity from the grid than you receive for exporting your clean energy. Therefore, feed-in tariffs play a major role in the economics of determining the suitability of solar power for your home.

How Much Will Self Consumption Save Me?

The rate to buy electricity from the grid is typically much higher than the rates for feeding electricity into the grid, so managing your usage can be a better strategy than chasing feed-in tariffs.

Typically, your solar power system will generate more power during the day than you use in your home. Imagine you receive an average feed-in tariff of 10c whilst paying your retailer 30c for every kWh you buy from the grid.

The difference between the two rates is 20c; this is how much you will save if you self-consume your solar power during daylight hours.

You can increase your daytime usage by scheduling appliances like dishwashers to run during the day, charging your devices during the day, and identifying any other energy habits you can optimise.

Next Steps

1 IPART paper on value of solar exports, Independent Pricing and Regulatory Tribunal.
2 Essential Services Commission.

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