Independent economic regulator publishes minimum solar feed-in rates for 2024–25

The Essential Services Commission has today released its final decision on the minimum electricity feed-in tariffs to apply from 1 July 2024 until 30 June 2025. The flat minimum feed-in tariff for the 2024–25 financial year is 3.3 cents per kilowatt hour (kWh), while time-varying minimum feed-in tariffs range from 2.1 to 8.4 cents per kWh.

Set annually by the commission, the minimum feed-in tariff is the minimum amount that energy companies must pay solar customers for electricity that is exported into the electricity grid. Retailers can pay customers more than the minimum feed-in tariff, but not less.

In setting the minimum feed-in tariff, the commission considers the costs retailers avoid when they receive solar exports (including the wholesale cost of electricity) and an allowance for the social cost of carbon. The commission aims to promote the long-term interests of both solar and non-solar customers by setting the tariff at a rate that reflects the value that solar exports provide to the energy market.

The minimum feed-in tariffs for 2024–25 reflect the changing value of solar exports amid increased solar generation in the market and low wholesale electricity prices during sunlight hours. You can learn more about why the minimum feed-in tariff changes on the Essential Services Commission website.

Executive Director of Price Monitoring and Regulation, Marcus Crudden says that despite the reduction in the minimum feed-in tariff, Victorian solar customers will continue to make significant savings on their electricity bills by using the power they generate.

“Consumers will get the best value from their solar by using the power they generate to avoid paying retail energy prices for the electricity they use. Shifting electricity usage to daylight hours – when solar is producing – is the best way to maximise the financial return on a solar system. This can save most solar customers in the order of around 30 cents per kWh – a far more efficient option than exporting electricity to the grid during daylight hours.”

Energy customers can also seek out a better overall deal using the Victorian Energy Compare website to compare energy deals and seek out a better offer, including potential solar savings and exports. The Victorian Energy compare website is the free and independent Victorian Government online energy price comparison service.