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Getting Paid For Your Solar Energy

The Joy Of Feed In Tariffs

When your solar PV panels produce electricity, you can configure your new "solar compatible" electricity meter in one of 2 ways:

1)You can "offset" the energy used in the home.

This means that you configure your new meter to simply not register when you export electricity out to the grid. The result is that your home will use any solar electricity that is coming out of your panels before it draws any electricity from the grid, so you save money by using less grid electricity.

The downside to this simple "offsetting" is that is if you have solar energy that is surplus to your home's requirements, you are not getting paid for it as it flows back into the grid. In fact the electricity retailer is getting free energy which it can, in theory, sell back to other customers as "Green Power" at a premium price! Ouch.

So why would anyone choose to "offset" their electricity. Basically because it keeps life simple. You don't need to worry about the state government rules and tariffs changing every 5 minutes.

Most people, however configure their system for the second option:

2) Export electricity into the grid, building a credit...

When your solar panels produce more electricity than your household is currently using, that electricity flows backwards through your electricity meter and into the electricity grid.

If your meter is configured to export energy, then as your meter "spins backwards", your bill is credited. By how much? Well that depends on the laws in your particular state and when you get to exporting electricity the rules change in most states. You can get a premium in some states (e.g. 60c kWh in Victoria) of virtually nothing in other states (e.g. 5c kWh in NSW).

So it’s really important to understand the details of the local deals that you can get, which may vary from utility to utility. It’s also vital to get a written quote from your installer on how much energy they expect you will offset and export, at what rates, compared to what you consume.

Check here to see the latest state by state solar feed in tariff information.

If you want to see how the feed in tariff in your state will affect the payback of a quoted solar system, have a play with our Solar Payback Calculator