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Solar feed-in tariffs are changing. Here’s what’s happening.

Solar

Australians are leading the world in the uptake of home solar per capita, go us! At certain times of the day, solar supply is outpacing demand.

While an abundance of solar is a good problem to have, flooding the grid with electricity when it isn’t needed is causing some challenges. It turns out you can have too much of a good thing... at least until we upgrade the grid to be able to handle it.

The good news is it’s our cue to take the next step in the renewables transition and, as a nation, redirect our energy from solar generation to solar storage as well – yep, home battery incentives will be next.

We need solar energy when the sun doesn’t shine too

You might be familiar with the idea that the price of electricity varies depending on the time of day, with higher rates during peak hours and lower rates during off-peak hours. It’s supply and demand.

Right now, excess solar generation exports are sometimes creating over-supply in the middle of the day, when what we need is more stored renewable power in the evenings.

Average electricity demand graph

The average demand for elecricity over a 24hr period. (Source AEMO, NSW 2024)

Time-of-use solar

Time-of-use or time-varying solar feed-in tariffs refer to time-based solar rates to encourage rooftop solar owners to either use their solar during the day, or store and use or export their spare solar when it’s needed.

Time of use solar tariffs have been offered by some retailers for a little while, so you might have already seen some solar feed-in tariffs offering a higher feed-in credit in the evening peak period and a lower credit in the hours during the middle of the day.

But from July 2025, you might start to hear more about two-way solar.

What’s two-way solar? Is it really a ‘Sun tax’?

Two-way solar refers to a solar feed-in pricing structure that includes charges for exporting to the grid, not just the credits we’re familiar with.

From 1 July 2025, distribution networks in New South Wales and South Australia will be moving some customers onto two-way solar network tariffs.

A network tariff is how an energy retailer (like us) is billed by the distribution network for managing electricity for our customers.

‘Sun tax’ is a shorthand term used to describe the charges portion of two-way solar, but it’s only part of the equation and no, it’s not a literal tax on sunlight.

Two way solar
Two way solar graph

Woah, why the change?

Two-way solar is being introduced to help manage the oversupply of solar being exported to the grid during daylight hours. The goal is also to encourage customers with solar to use the power they generate and reward those who invest in batteries – and can defer exporting their surplus in the evening when demand is high.

Who might be impacted?


Solar generating households in NSW and SA

Momentum electricity customers in NSW and SA that are on a two-way solar tariff with their network may be quoted a time-varying solar tariff when they sign up to a plan with us. Customers will be quoted with the applicable solar pricing at that time.

Momentum’s existing solar customers will be notified in advance if anything is going to change about their solar feed-in tariff.

Electricity customers in NSW cannot be charged for solar exports by retailers.


Solar generating businesses in NSW and SA

Small businesses that are on a two-way solar tariff with their network may be quoted a time-varying solar tariff when they sign up to a plan with us and will be quoted with the applicable solar pricing at that time.

Existing Momentum solar customers will be notified in advance if anything is going to change about their solar feed-in tariff.

Small electricity customers in NSW cannot be charged for solar exports by retailers.

If you have a large commercial contract with us, any applicable network charges for solar will be passed through as a network charge.


Solar households and small business sites in VIC and QLD

For now, two-way solar pricing will not be implemented in Victoria or Queensland. In Victoria the minimum feed-in tariff that can apply to solar is 0.0 c/kWh.

FAQs?

How can I monitor how much solar electricity I am exporting to the grid at different times of day? openclose

You may be able to view electricity generation, usage and exports through the online monitoring platform specific to your solar system. Your electricity distributor may also have an electricity usage interface that you can access. If you have a smart meter, Momentum's weekly usage email called Power Tool can show you more detail about how much solar you export to the grid and when. More about Power Tool here: https://www.momentumenergy.com.au/powertool

What's the point of solar panels if I can't earn a feed-in credit during the time when my solar system is generating electricity? openclose

The biggest benefit of having solar panels is generally the money saved by consuming your solar-generated power rather than paying for power from the grid. If you can try to run more of your appliances (such as the washing machine or dishwasher) during sunlight hours, this could help you save on your electricity bills.

Time for a battery?

If you’re a solar generating residential or business customer, with a large system, it could be time to look into solar battery incentive programs in your area.

Home batteries and electric vehicle integrations are the next step in shoring up a decentralised renewable grid and making sure you’re getting the most out of every drop of solar you produce. If you’re a business with multiple sites you can use the solar generated at one site to offset power usage at other sites with Momentum’s Virtual Solar Sharing.

And if you’re a Momentum customer, our friends at Solargain can help get you sorted with all sorts of solar products.

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