Solar Choice Solar PV Price Check - March

Previous Solar Choice Photovoltaic Price Indexes for 2013 reveal an industry in transition.

Solar PV Prices in January were significantly more expensive than in December 2012, as a result of the early closure of the Solar Credit Scheme at the turn of the year. The updated installer prices for February show an attempt to continue the downward price trend that has been the industry norm since state and federal incentives were introduced.

The PV Price Index for March 2013 reveals a change in approach by many installers. The introduction of higher quality products at the lower end of the price scale, and premium installer options adjusted to reflect real costs at the top, has lead to higher system prices in some areas of the index. However, rising demand in Queensland and increasing STC Values, have lead to lower prices in other areas. What may become evident as 2013 progresses is how installers will deal with future reductions in federal incentives.

Going forward, the solar industry may have a brief reprieve from the policy rollercoaster that was 2012. With a federal election announced for September, it is unlikely that any decisions that could potentially alienate voters with be pushed forward as both parties will be looking to placate both pro- and anti-solar camps. 

Indeed, the recommended threshold reduction for Small-scale Technology Certificates from 100kW to 10kW, expected soon after the government came back from the summer break in early February, seems to have shelved for the time being.

Cost of installed solar PV systems by city and system size

The average price for a fully installed 1.5kW solar PV system has risen for all cities listed in our comparison other than Brisbane, which showed a slight decrease.

This may be as a result of the approaching installation deadline for households who applied and were awarded the 44 cent feed-in tariff – applications for the tariff itself closed on July 9, 2012.

In the 2kW category, Queensland shows a decrease in the average system price. Melbourne and Perth average system prices have lowered by $30 and $80 respectively. System prices rose marginally in Adelaide, Canberra, Hobart and Sydney at the 2kW size.

Qualitative feedback from Solar Choice brokers, in addition to data on minimum and maximum system prices, indicates that installers have updated the components offered in their PV systems deals.

*Includes STC discount

Once the system size reaches 3kW, a downward trend remerges for prices on an Australia-wide basis. However, closer examination reveals that the decrease is not across the board but is location-specific. 

Solar PV prices in Canberra and Hobart have risen for all system sizes, while other cities show a mixed offering. Perth and Brisbane have performed best overall, with Brisbane solar prices down across the board, and Perth prices lower for 2kW and above. The lowest cost solar PV is in Perth, while Hobart has the highest system prices.

*Includes STC discount

Replicating the data shown in the ‘Average Solar PV System Prices' table, the average cost per watt is up for 1.5kW and 2kW systems and down for 3kW, 4kW and 5kW solar PV systems. 5kW solar PV systems continue to provide the lowest cost per watt, at $1.95.

 Solar PV System Prices – minimum and maximum

The increase in 1.5kW prices is a knock-on effect of the increase in both minimum and maximum system costs.

The minimum price for a 1.5kW system has risen by $124, while the premium system cost has risen by $400. When comparing the panels and inverter offered at the beginning of February with those on offer at the beginning of March, products from better-established manufacturers are now being used in the lowest cost systems, the premium system costs have been adjusted in line with the ‘real' cost of solar PV – the cost of solar now that the Solar Credit Scheme has ended.

*Includes STC discount

There has been a slight decrease in the minimum price in the 2kW category. However, a significant increase at the premium end of the market has resulted in an increase in the average price of a 2kW system. A decrease at the lower end of the 3kW price scale has gone some way towards cancelling out a rise at the premium end. The decrease in the average cost of both 4kW and 5kW systems cannot be explained by the minimum and maximum figures, as both have risen significantly.

Average STC Value

The average STC value has risen for the third consecutive month, and is now over $29 across all system sizes.

Brisbane has the highest STC prices, $30 per STC for 3kW, 4kW and 5kW systems, and market value for 1.5kW and 2kW systems (this figure is listed on the Clean Energy Council website and updated regularly). The CEC spot price has recently been hovering around $33 per STC. Canberra has the lowest STC price on offer, this may go some way to explaining the higher system prices there.

The maximum and minimum figures updated in the February PV Price Index have remained the same. The best price on offer is $34 or market value and the lowest price on offer is $25. The STC value does not appear to be affected by system size, both the minimum and maximum prices sitting around the middle of the system cost table.

Australia is divided into a number of REC Zones and the STCs are allocated on this basis, regions that receive a great number of sunshine hours (such as Far North Queensland) are allocated a greater number of STCs, whilst those in less sun-blessed areas (such as Victoria and Tasmania) receive fewer. STCs offer customers a means to offsetting the upfront cost of their solar PV system based on the likely output over a 15-year period.

STCs are one part of the Renewable Energy Target; ‘liable entities' are obliged to purchase and surrender a certain number of Renewable Energy Certificates (RECs) every year, with the total number of RECs required to meet the target increasing annually.

About this data

All figures are based on the offerings of active installers on the Solar Choice installer network for each of the six major capital cities. The system prices above do not reflect the average prices at which systems are ultimately purchased.

About Solar Choice

Solar Choice works with 100 solar PV installers in providing free and impartial Solar Quote Comparisons for customers throughout Australia. Solar Choice Commercial manages tenders for a wide range of commercial-scale solar PV projects throughout Australia, including solar farms and utility-scale solar PV plants.