SGU Owners Guide
RET process for Owners of Small Generation Units (SGUs)
small-scale solar photovoltaic panels, wind and hydro electricity systems
Option 2 - Individual Trading
- As this process is relatively complex a majority of owners assign their RECs to an agent. For information on how to engage an agent see – Option 1: Agent Assisted
Step 1: Determine if your system is an SGU or power station
Compare your system's kW capacity against the following criteria to determine if your system is an SGU or power station
| System type | System capacity and annual electricity output | Installation periods |
|---|---|---|
| Small wind turbines | No more than 10 kW and a total annual electricity output less than 25 MWh | On or after 1 April 2001 |
| Solar (photovoltaic) systems | No more than 100 kW and a total annual electricity output less than 250 MWh | On or after 14 November 2005 |
| Solar (photovoltaic)systems | No more than 10 kW and a total annual electricity output less than 25 MWh | Between 1 April 2001 and 13 November 2005 |
| Hydroelectric systems | No more than 6.4 kW and a total annual electricity output less than 25 MWh | On or after 1 April 2001 |
If the kW rating or MWh generation for a SGU is above the respective thresholds or if the unit was installed prior to 1 April 2001, it is not eligible to have RECs created for it as a SGU. However, it may be eligible for accreditation as a renewable energy power station.
Upon installation of a small hydro, small wind or small solar (photovoltaic) system with a capacity of less than the prescribed threshold for a small generation unit RECs may be created under the legislation as if the system were a small generation unit.
Any subsequent installation of additional capacity with the effect that the total capacity of the system exceeds the prescribed threshold of capacity for a small generation unit, will mean the system is no longer a small generation unit. The operator of the system may apply for accreditation of the system as a power station and if the system satisfies the requirements for accreditation then the Regulator will accredit it.
However, RECs may not be created for electricity generated by that part of the power station that was the ‘small generation unit’ as originally installed, and for which RECs were created. The nominated person for the power station will need to determine what proportion of electricity generated by the whole power station was generated by the 'old' small generation unit and deduct that electricity from the total electricity generated by the power station. The nominated person will then only be able to create RECs for that portion of electricity generated by the 'extended' part of the power station.
Information on the power station accreditation process is available on the power stations page of the ORER website.
If your system meets the above eligibility criteria go to Step 2.
Step 2: Check if your SGU installation is within the time limit for creating RECs
Time limits for the creation of RECs for SGUs may apply depending on their installation date and SGU type. If the installation date and REC creation time limit for your SGU falls outside of the following thresholds your system is not eligible to create RECs.
| SGU installation date | Deeming period | SGU type | REC creation time limit |
|---|---|---|---|
| On or before 6 October 2007 | 1 or 5 years | Wind, solar (photovoltaic), hydro | Anytime after installation |
| On or after 6 October 2007 | First deeming period (1 or 5 years) | Wind, hydro | Within 12 months of the installation date |
| On or after 6 October 2007 | First deeming period (1, 5 or 15 years) | Solar (photovoltaic) | Within 12 months of the installation date |
Step 3: Establish the deeming period for your SGU
If your SGU meets the eligibility requirements you can establish the deeming period for your SGU. RECs may be created for SGUs in batches, for either 1, 5 or 15 year deeming periods, depending on the particular installation. At the beginning of each subsequent deeming period, the Regulator must be satisfied that the SGU is still installed and is likely to remain functional for the next deeming period. The ORER may request evidence to support this claim.
RECs may be created for wind and hydro SGUs either:
- annually; or
- on installation for the first 5 years after the installation (the deeming period) and then at the start of each subsequent 5 year deeming period.
RECs may be created for solar (photovoltaic) SGUs either:
- annually; or
- on installation for the first 5 years after installation (the deeming period) and then at the start of each subsequent 5 year deeming period; or
- on installation for 15 years (the deeming period) - no further RECs may be created. Special eligibility requirements are associated with the 15-year deeming option. The system needs to be design and installed by an accredited Clean Energy Council (CEC) installer for stand-alone and grid-connected power systems.
Step 4: Determine if your system is eligible for Solar Credits
Solar Credits is a mechanism under the expanded RET which multiplies the number of RECs able to be created for eligible installations of SGUs.
There is not means testing for Solar Credits under the legislation.
Solar credits will apply to the first 1.5 kilowatts (kW) of capacity installed. Generation from capacity above 1.5 kW will still be eligible for the standard 1:1 rate of REC creation.
Eligibility requirements are as follows:
- the small generation unit in respect of which the certificates are created is installed at eligible premises between 9 June 2009 and 30 June 2015.
- at the time the small generation unit is installed at the eligible premises, there is no pre-approval or funding agreement in force in respect of the unit under the Solar Homes and Communities Plan (SHCP), the Renewable Remote Power Generation (RRPGP), or the National Solar Schools Program (NSSP) and no financial assistance has been provided in respect of the unit under the SHCP, the RRPGP or the NSSP.
- at the time the small generation unit is installed at the eligible premises, financial assistance under the SHCP, the Photovoltaic Rebate Programme (PVRP), the RRPGP or the NSSP has not been approved or provided in respect of any other small generation unit at the eligible premises.
-
the small generation unit is a new and complete unit. A system is a complete unit if:
- the unit is capable of generating electricity in a form that is usable at the eligible premises where it is installed without the need for an additional part or parts to be added to or incorporated into the unit.
- the unit is wired directly to the eligible premises where the unit is installed so that its output is capable of being metered at the premises or the unit includes a meter that is dedicated to measuring the electricity output of the unit.
-
at the time the small generation unit is installed at eligible premises, certificates have not been multiplied in respect of any small generation unit at the premises and:
- on one occasion only, irrespective of whether the certificates are created for a 1-year, 5-year or 15-year period; and
- only if the certificates relate to the first 1.5 kW of the rated power output of the unit.
The multiplication for additional RECs under Solar Credits is as follows.
| Installation Period | Multiplication |
|---|---|
| 9 June 2009 - 30 June 2010 | 5 x |
| 1 July 2010 - 30 June 2011 | 5 x |
| 1 July 2011 - 30 June 2012 | 5 x |
| 1 July 2012 - 30 June 2013 | 4 x |
| 1 July 2013 - 30 June 2014 | 3 x |
| 1 July 2014 - 30 June 2015 | 2 x |
If you are installing an off-grid SGU your system may be eligible for additional Solar Credits. For more information see the Current Agents Guide – off-grid
Installing additional capacity
If you wish to install additional capacity to an existing system it may be entitled to RECs. Additional capacity is not entitled to the REC multiplier through Solar Credits. To determine the number of RECs the additional capacity may be entitled to insert the rated power output (in kW) for the additional capacity into the Small Generation Unit REC Calculator. Note the number of RECs without Solar Credits in the result.
Visit – Small Generation Unit REC Calculator
Definition of an eligible premises
Regulation 20AA covers the circumstances in which Solar Credits can be claimed. Solar Credits can only be claimed for one small generation unit installed at each ‘eligible premises’.
‘Eligible premises’ is defined in the Regulations to mean any of the following:
- a house (including the land on which the house is located and any outbuildings on the land)
- a townhouse
- a residential apartment
- a shop (including the land on which the shop is located and any outbuildings on the land)
- other premises located at an address
An outbuilding is a detached building subordinate to a main building and is not considered to be an eligible premises in its own right.
House
A house is an eligible premises. For a house that is an eligible premises:
- a home office located in the house or in an outbuilding on the land where the house is located; or
- a business operated from the house or in an outbuilding on the land where the house is located;
is not a separate eligible premises.
Townhouse, residential apartment
A townhouse, residential flat, unit or apartment is an eligible premises including those located in a:
- multi-story apartment building; or
- retirement village (this does not include a room in a nursing home, hostel or similar assisted living facility).
For a townhouse, residential flat, unit or apartment that is an eligible premises:
- a home office located in the townhouse, residential flat, unit or apartment; or
- a business operated from the townhouse, residential flat, unit or apartment;
is not a separate eligible premises.
Shop
A shop is an eligible premises (except when located in a house (land or outbuilding), townhouse, residential flat, unit or apartment that is itself an eligible premises – see above). Each shop in a shopping mall or other multi-shop type complex is an eligible premises.
Other premises located at an address
Business premises (eg factories and offices)
Each separate business which is located at an address will be a ‘premises located at an address’ (except when located in a house (land or outbuilding), townhouse, residential flat, unit or apartment that is itself an eligible premises). Some businesses may be located at an address which covers several numbers in a street (e.g. a factory might be at 42-56 Smith Street). In such a situation, there is only one eligible premises.
Alternatively, some businesses will occupy a separate unit at a single street address, where a different business is carried out in the separate units, (e.g. Unit 2 of 56 Smith Street). Each unit is a separate eligible premises.
Specific types of premises
Each of the following types of businesses are regarded as a single eligible premises:
- a motel, hotel, resort or caravan park (each room/cabin/villa etc in a motel, hotel or resort and each stationary caravan in a caravan park is not a separate eligible premises)
- a nursing home, hostel (each room is not a separate eligible premises)
- a hospital
- a restaurant
Community and educational buildings
The building(s) located at an address where a community group or institution carries out its activities (including the land on which the building is located and any outbuildings on the land) is a single eligible premises (eg a scout hall, guides hall, sporting club, school, church or other religious building). In the situation where the building(s) is or are used by more than one organisation, there is one eligible premises only.
More than one premises located at a single address
Where more than one separate premises (excluding outbuildings) is located at a single address, all of those premises are separate eligible premises. Examples might include a:
- dairy on a farm that is separate to the residential house on the same farm — both premises are eligible premises;
- owner/manager’s house that is separate to the rest of a caravan park but at the same address — the house is a separate eligible premises to the caravan park;
- green keeper’s house that is separate to the rest of the golf course at the same address — the house and the business premises are separate eligible premises.
To be another 'eligible premises' at a single address, the premises must be clearly separate from the other eligible premises located at the address (e.g. the house). A building is not an eligible premises if it is an outbuilding associated with a house. For example:
- a garage, studio or other small building situated in close proximity to a house which itself is an eligible premises (where a small business may be carried out) is as an outbuilding and not another eligible premises;
- a larger business premises that is not subordinate to a house which itself is an eligible premises, and which more commonly is located further from the house than is usual for a garage or studio, is not an outbuilding and therefore is a separate eligible premises.
Structures that are not eligible premises
The following structures are NOT eligible premises:
- street lights, street signs, mobile phone towers, boats, cars and trailers; and
- mobile homes, caravans or similar wheeled vehicles not intended to be permanently attached to the land (these are not defined as eligible premises because they do not remain at a location for a long period of time).
Premises that are not eligible
If you would like clarification regarding the eligibility of a particular premises, please contact the Small Units Team at the ORER via email orer@orer.gov.au. Include in your email as much detail as possible including location, address, boundaries, road access, title information, access to electrical connection and metering, ownership, occupancy, nature of business, maps and other information you may wish to provide.
- If a system is not eligible for Solar Credits the system can still create RECs with the standard 1:1 rate of REC calculation.
Step 5: Obtain all relevant compliance paperwork
Under the regulations all SGUs installed on or after the below dates will require additional compliance documentation that must be acquired before you can create RECs:
- PV Solar installations on or after 20 August 2010
- Hydro and wind installations on or after the 20 December 2010
The additional compliance documentation is as follows:
- Request a copy of the installer’s electrician’s licence. The electrical wiring associated with grid-connected installation of the unit must be undertaken by an electrical worker holding an unrestricted licence for electrical work issued by the State or Territory authority for the place where the unit was installed.
- Obtain the site and grid connected written statement. Either the installer or the owner must sign a statement that all required local and state/territory approvals have been met for:
- The siting of the unit
- If the unit is attached to a building or structure including the attachment of the unit to the building or structure
- If the unit is grid connected including the grid connection of the system
- Obtain from the installer a signed written statement that includes the name of the designer and the installer of the unit, and their CEC classification and accreditation number.
- Obtain from the installer a copy of any documentation required, by the laws of the jurisdiction in which the unit was installed, certifying that the electrical installation of the unit complies with laws relating to safety and technical standards. This could be in the form of a Certificate of Compliance, Installation Report and Electrician’s Licence.
- Off grid installation statement - A written statement is required from the installer of an off-grid installation. The statement must confirm:
- The unit is off grid; and
- An electrical worker holding an unrestricted licence for electrical work issued by the State or Territory Authority for the place where the unit was installed undertook all wiring of the unit that involves:
- alternating current of 50 or more volts; or
- direct current of 120 or more volts.
For examples of written statements visit – Example written compliance statements for SGU installations
The REC Registry will contain additional questions that require confirmation that the above processes have been actioned. Ensure that you keep on file the documents stipulated in the regulations.
Visit - Regulations
ORER will continue to conduct auditing and compliance activities which will include sighting the additional paperwork required. Failure to comply with the regulations can result in penalties and prosecution where warranted.
Step 6: Determine how many RECs your SGU is entitled to
Installations of SGUs are deemed to be eligible for RECs based on rated power output (kilowatt capacity), eligibility for Solar Credits and geographic location or resource availability.
If you would like to determine the approximate number of RECs that your system could receive under the RET the REC Registry contains a Small Generation Unit REC Calculator.
Visit - Small Generation Unit REC Calculator
If you would like to understand how RECs and Solar Credits for SGUs are calculated you can view the detailed calculations in the REC Calculations publication.
Visit - SGU REC Calculations
Step 7: Become a registered person in the online REC Registry
Once you know the number of RECs you are entitled to you will need to become a registered person in the REC Registry, an internet based registry system that:
- maintains various registers (as set in the Act)
- facilitates the creation, registration, transfer and surrender of RECs
A registered person can create, sell and transfer RECs in the REC Registry. To become a registered person in the REC Registry you will need to:
- Create an account on the REC Registry. See the Apply for an Account link on bottom right of the REC Registry home page.
Visit - REC Registry - Complete an Application for Registration and send it to the ORER.
Visit - Application for Registration - The ORER will notify you via phone when your Application for Registration has been approved and explain the REC Registry process.
- Pay a $20 registration fee to complete the registration process.
Please DO NOT send any payment to the ORER with this application form - payment of the $20 registration fee is made via your account in the REC Registry. The application fee is GST exempt.
Step 8: Create RECs through the REC Registry
Once your application has been approved you are ready to complete the registration process online and create RECs for your SGU installation.
Visit - REC Registry
The main details required to create RECs include the following:
- Type of system - solar, wind, hydro
- System brand
- System model
- Panel serial numbers (solar only)
- Number of panels (solar only)
- Equipment module serial number (wind and hydro only)
- Resource availability (wind and hydro only)
- Rated power output (in kW)
- Installation date
- Installation address
- Installer's details
- Owner's details
The REC registry contains online help screens and a REC Registry Support Desk to assist in the use of the Registry.
Step 9: Wait while your RECs are validated
Once you have created your RECs, they will be validated by an ORER officer to ensure they have been created correctly. This can take up to 4 weeks. When your RECs have passed the ORER validation, they will become 'Registered'. Registered RECs are able to be sold and transferred in the REC Registry, and surrendered either voluntarily or meet a liability under the Renewable Energy Electricity (Act) 2000. If the RECs are not correctly created they are failed by ORER.
Visit - REC Registry
Step 10: Find a buyer for your RECs. Sell your RECs and transfer them in the REC Registry
- You do not have to sell your registered RECs at all, but if you wish to create RECs for your SGU installation you must create them within 12 months of the date of installation of the system.
If you wish to sell your RECs, it is your responsibility to find a buyer and negotiate the price and other terms of sale. Potential buyers may include:
- electricity retailers who may need to purchase RECs to meet their REC liability
- registered agents for deemed units, who create and trade RECs from SGUs
- traders of RECs
Price and payment date should be key considerations when negotiating the sale of your RECs. You should ensure that:
- you are satisfied with the price and payment date your receive for your RECs
- details are recorded in writing before entering any contractual arrangement to sell your RECs.
Once you have found a buyer and negotiated the terms of sale, you will need to transfer the RECs to the buyer through the REC Registry and arrange payment outside the REC Registry. The ORER does not set the price of RECs nor does it get involved in disputes between buyers and sellers. Payment for RECs or the rights to create RECs is a contractual matter between the buyer and seller.
