Does Solar Panel Work on Cloudy or Rainy Days?

Solar panels perform at their best on a clear sunny day with no cloud cover. This does not mean that the conditions are going to be favorable all the time. Most often panel performance is reduced due to weather conditions like cloud cover or rain. In such conditions, solar panels produce their power from diffused solar radiation (radiation scattered by molecules in the atmosphere) as there is hardly any direct sunlight.
As a general rule, there is a considerable decrease in solar panel performance due to cloud cover or rain. If the cloud cover is very heavy, solar panels may  produce only 10-25% of the energy they normally produce. But it may be noted that some solar panels are designed to work well with diffused solar radiation on a typical overcast day.
Rains can also be helpful in some ways. For example, rain cleans the solar panels by removing dust and dirt which otherwise affects solar panel performance. And this decreases maintenance which is normally a problem in the case of rooftops.

Solar incentives–02

FEED-IN TARIFF (FIT)FOR GRID-CONNECTED SOLAR POWER SYSTEMS

A solar feed-in tariff is a rate paid for electricity fed back into the electricity grid from a designated renewable electricity generation source such as a rooftop solar panel system or wind turbine.

At present, feed-in tariff regulations for renewable energy exist within Australia and they are widely considered one of the most effective ways to increase solar energy uptake.

Is an income from a feed in tariff taxable?

At this point, there doesn’t appear to be any specific taxation legislation dealing with income derived from feed in tariffs. Whether it is assessable income depends on the income producing nature of the activity. If it can be demonstrated that the system was installed with a view to making a profit, then receipts under the feed in tariff would be considered assessable income while all expenses associated with the income generating activity would be deductible (eg depreciation).

In most cases, systems installed at domestic sites would not be taxable as they would be considered personal use / hobby (i.e. not in the nature of a business or profit making scheme). If the system is installed at a commercial site, it will most likely be considered taxable. However, system owners should consult their  accountant for advice or can also request a private ruling from the ATO. An example of an ATO private ruling result in relation to feed in tariffs can be viewed here

Feed in tariff income and social security

According to a  May 2010 announcement from Centrelink, feed in tariff credits where applied as a credit on an electricity account are not included in Centrelink’s income test for pensioners, but credits converted to cash payments such as a cheque or direct deposit will be.

The adjusted policy applies from 14 May 2010 and is relevant to not just pensions, but all Social Security income support payments such as NewStart. However, we are still unclear if this applies to payments such as Family Tax Allowance and Parenting Payments. We advise people who may be affected should consult with their local Centrelink Office.

Is GST payable on feed in tariff revenue?

Individuals will not need to pay/remit GST from their feed in tariff income. The reason being that selling electricity back to the utility providers is considered an enterprise but you need to receive $75k per annum from this source to be required to register for GST. However, businesses will need to pay/remit GST for their feed in tariff income.

Western Australia net feed in tariff

New systems connected under the State Government’s Renewable Energy Buyback Scheme receive  7.135c per kilowatt hour. However, Horizon Power has introduced area-specific solar feed-in tariffs. While owners of systems in some towns will receive a much higher rate, others will receive less.

Contact us now to get your FiT benefit!

Solar incentives–01

There are two main incentives that can help pay off solar PV systems: small-scale technology certificates (STCs) and feed-in tariffs (FiTs).

Small-scale technology certificates (STCs)

Under the federal government’s Solar Credits Scheme, eligible households receive money for STCs created by their PV systems. STCs were formerly known as renewable energy certificates or RECs. Currently, the scheme allows you to cash in the certificates you could earn over the next 14 years straight away.

While the government has set a price of $26 per STC sold through the STC Clearing House, the price you get will vary depending on how you choose to sell your STCs.

The easiest and most common option is to allow someone else – usually the installer – to sell them on your behalf. This may then be applied as a discount to your installation costs. The benefit is that the process is easy, with all the paperwork taken care of for you. The downside is you’re likely to get less money per STC – you can expect about $20 or lower per STC.

The second option is to sell the STCs yourself, which involves considerable paperwork, applications and fees. Depending on the number of buyers and the time it takes to complete the process, it may be months after installation before you receive your funds. There’s no way to tell exactly how long you could be waiting, which means unless you have the capital you might find yourself out of pocket. However, you should get a better price. On average, clients who sold their STCs themselves got a price of $20 per STC, with the highest price per STC being $28.

Wonder how much you have saved on the solar system you purchased? Contact us to find out more!

To be continued……

How to get your daily power consumption?

You can easily determine how much electricity you use by looking at the back page of your last power bill. The amount of electricity you consume will be shown in kilowatt hours (kWh). This is the first step in determining how much you can save with solar power as well as which system is right for you.

Typically, larger properties or households with higher energy demands will require a solar power system around the 5kW range or higher.

A 5kW system in Australia generates between 20kW/h – 35kW/h (depending on your region) of solar electricity on average per day. Refer to your bill to see how many kW/h or units you are currently using.

Some regions are limited by the size of the system they can install; to find out more information, contact us.