For more than a decade, one number quietly decided whether a business could claim the same upfront solar discount that put panels on millions of Australian homes: 100 kilowatts. Stay under it and you qualified. Go over it, which most warehouses, factories and cold stores do the moment a system is sized to their daytime load, and the discount disappeared. That line has now moved.
On 5 August 2026, Climate Change and Energy Minister Chris Bowen announced at the National Press Club in Canberra that the Small-scale Renewable Energy Scheme (SRES) will cover commercial solar systems up to 1 megawatt, ten times the old cap. The change is scheduled to take effect on 1 October 2026 and is expected to reduce the upfront cost of an eligible system by around 20 per cent.
For a business that has quoted commercial solar before and walked away because the sums were tight, this is the first change in fifteen years that shifts the starting number in your favour.
What actually changed
The scheme itself is not new. Since 2011 the SRES has handed households an upfront discount through Small-scale Technology Certificates (STCs), and it is the reason roughly one in three Australian homes now runs on solar. Businesses were technically allowed in, but the 100 kW ceiling shut most of them out, because a system that size barely covers the daytime draw of a mid-sized shed.
Here is the change in plain terms:
- The STC eligibility limit rises from 100 kW to 1 MW (1,000 kW), a tenfold increase.
- Any new system between 100 kW and 1 MW installed from 1 October 2026 can generate STCs.
- The government estimates the discount at around 20 per cent of the upfront installed cost.
- The reform is designed to be budget-neutral, because it runs through the same certificate market that already funds household solar rather than a new pot of money.
- To generate STCs, the system must be new and installed by a Clean Energy Council (CEC) accredited installer using CEC-approved equipment, the same standard that already applies to household solar.
The target is what the government calls the “missing middle”: the factories, distribution centres, farm sheds, schools and retail complexes sitting on thousands of square metres of empty roof. Australian businesses have installed only about 5.6 GW of rooftop solar against a residential figure north of 22 GW, despite the technical potential on commercial roofs running past 80 GW.
Why this is bigger than a 20 per cent discount
The headline number is the discount. The more useful story is which certificate you get.
Before this change, a system above 100 kW fell out of the STC world and into Large-scale Generation Certificates (LGCs). LGCs are earned one at a time for every megawatt-hour your system produces, then sold to electricity retailers over the life of the system. They can add up, but they arrive slowly, they carry price risk, and they need ongoing accreditation and metering to claim. For a business owner weighing solar against every other call on capital, an income stream that trickles in over years rarely tips a decision.
STCs work the opposite way. They are created once, up front, based on how much your system is expected to generate over its deeming period, and the value comes straight off your purchase price at the point of sale. There is no waiting and no paperwork on your side, because your installer handles the certificate creation and applies the discount to the quote.
Moving the 100 kW to 1 MW band from LGCs to STCs is what turns a marginal proposal into a bankable one. As one Central West winery owner put it in coverage of the announcement, a cut of that size can be “probably enough to enable the business case to get loans from the bank.” The upfront certainty is the part that changes behaviour, not the percentage on its own.
What the savings look like on real systems
The government released worked examples alongside the announcement. They give a fair benchmark, though your actual figure depends on system size, your location’s deeming zone and the STC spot price on the day certificates are created.
| System size | Typical site | Estimated upfront saving |
| 250 kW | Medium retail, offices, mid-sized warehouse | around $68,000 |
| 500 kW | Larger warehouse, manufacturing, cold storage | roughly $135,000 (pro-rata estimate) |
| 850 kW | Large logistics centre or retail complex | more than $232,000 |
A quick word on how STCs are valued, since it is where the real number comes from. The certificate count is driven by system size and your postcode’s sunshine rating, then multiplied by the market price for a certificate. When the STC price is strong, your discount is larger; when it softens, the discount eases. A written proposal should show you the certificate count and the assumed price, not just a round “20 per cent,” so you can see exactly what sits behind the figure.
Which businesses stand to gain the most
Solar pays back fastest where generation lines up with consumption. The businesses in the sweet spot for the expanded rebate tend to share a few traits:
- They own their building, or hold a long lease with the landlord on side, so the party paying the power bill also controls the roof.
- They run most of their load in daylight hours, which describes manufacturers, food producers, cold stores, retailers, medical centres, schools and logistics operators.
- They have large, structurally sound roof space or hardstand suitable for a carport array.
- They are on a tariff heavy enough that shaving 40 to 70 per cent off daytime grid draw is material.
If your peak demand sits squarely in the middle of the day, the expansion is close to purpose-built for your site. Our team designs commercial solar systems from 30 kW through to 500 kW and beyond, matched to a building’s consumption profile rather than a stock template.
What the rebate does not fix
An upfront discount improves the economics. It does not remove the practical steps that sit around a commercial install, and going in with clear eyes saves time later.
- Grid connection. Approval to connect a medium-sized system to the network has long been the slow, unpredictable part of a commercial project. The government has asked the Australian Energy Market Commission to develop reforms to make these approvals faster and more consistent, but that work is in progress and no firm timeline has been set. Ask what current connection timeframes look like in your network area before you plan around a go-live date.
- Roof structure. A commercial roof needs a structural assessment to confirm it can carry the array. This is standard, and worth booking early rather than discovering a constraint at design stage.
- Tenancy. If you lease, the roof belongs to the landlord and the incentives are split, since you pay the power bill but they own the asset. A Power Purchase Agreement or a clear ownership and maintenance agreement can bridge that gap.
- Demand charges. Some commercial tariffs bill on peak demand as well as consumption, and solar alone does not always cut that component. Pairing solar with storage, or reshaping when heavy loads run, is often what addresses it.
None of these are dealbreakers. They are simply the reason a proper energy assessment beats a rooftop guess.
Why the window before 1 October matters
The rebate lands on 1 October 2026, roughly eight weeks after the announcement. That is a short runway once you account for the work that has to happen before a panel goes up: an energy assessment, a structural check, a system design and, most importantly, the network connection application, which is frequently the longest single item on the calendar.
Businesses that start the design and approval process now are the ones that will be shovel-ready when eligibility opens, rather than joining a connection queue that thickens as demand for medium-scale systems rises. Getting the paperwork moving early costs nothing and protects your timing.
How it stacks with battery incentives
The SRES discount applies to the solar panels and inverter. Storage sits under a separate program, the Cheaper Home Batteries Program, which reduces the cost of an eligible battery by roughly 30 per cent. The two incentives cover different parts of the system, so a business installing solar and storage together can benefit from both on their respective components.
Storage is also where demand charges and after-hours load get addressed, which is why many sites size the solar array with a battery in mind even if it is added in a later stage. If you want the detail on how the storage rebate works, our guide to the federal battery rebate covers eligibility and figures.
Ready to see what the expanded rebate means for your site?
The 1 MW change rewrites the maths for the exact band of businesses that were previously too big for the household rebate and too small to bother with large-scale certificates. Greenlight Solar designs and installs commercial systems across NSW and QLD, manages the rebate and connection paperwork on your behalf, and can model the savings against your actual bills before you commit. Request a free commercial solar assessment and we will show you the numbers for your roof, not a rounded percentage.
Frequently asked questions
When does the 1 MW commercial solar rebate start?
The expanded SRES is scheduled to take effect on 1 October 2026. It was announced on 5 August 2026 and is subject to the final legislation and implementation details being confirmed, so it is worth checking current eligibility before you lock in a project.
Does my system have to be under 1 MW to qualify?
Yes. The expansion covers systems above 100 kW and up to 1 MW (1,000 kW). Systems at or below 100 kW were already eligible under the old rules. Anything above 1 MW sits outside the SRES and falls under a separate large-scale framework.
Is the rebate paid to me, or taken off the price?
It comes off the price. Your installer creates the STCs at the time of installation, sells them into the certificate market and applies the value directly to your quote. You pay the reduced amount up front rather than claiming anything back later.
We already run a 90 kW system. Can we expand it and claim the rebate?
You cannot retrospectively claim STCs on an existing system. Depending on your current setup, roof space and grid connection capacity, expanding the system to take advantage of the higher threshold may be possible, and that is worth assessing on a site-by-site basis.
Why is an upfront STC rebate better for a business than LGCs?
STCs deliver the discount once, up front, at the point of sale, with no ongoing admin on your side. LGCs, which previously applied to systems above 100 kW, are earned per megawatt-hour over years and sold to retailers over time. For most businesses, the upfront certainty of STCs is what makes a project bankable.
Will the rebate amount stay fixed after 1 October?
The 20 per cent figure is an estimate. The actual value tracks the number of certificates your system generates and the STC spot price when they are created, so it moves with the market. A detailed proposal should show you both the certificate count and the assumed price.
Does the rebate cover a battery as well?
No. The SRES discount applies to solar panels and inverters. Battery storage is supported separately through the Cheaper Home Batteries Program, which can apply alongside the solar rebate on the battery component.
What should we do before 1 October 2026 to be ready?
Start the assessment and approval work now. That means a review of your electricity bills and load profile, a structural check on your roof, a system design and, above all, lodging the network connection application early, since that is usually the longest lead-time item.
