Commercial Solar Rebate Jumps to 1MW in October

Australia's commercial solar sector is about to see its biggest policy shift in more than a decade. From 1 October 2026, the Small-scale Renewable Energy Scheme (SRES) will expand its eligibility cap from 100kW to 1MW, a tenfold increase that opens government-backed solar rebates to warehouses, factories, farms, schools, and shopping centres that were previously locked out.

If your business has held off on solar because a large enough system didn't qualify for a rebate, this is the change to watch.

What is changing on 1 October 2026

The SRES works through Small-scale Technology Certificates (STCs). Install an eligible solar system and you generate certificates that energy retailers are required to buy, which lowers your upfront cost. Until now, that scheme only applied to systems up to 100kW, a ceiling that pushed most larger commercial rooftops out of the small-scale market entirely.

From 1 October 2026 (subject to final regulations), that ceiling rises to 1MW. Businesses can now install systems up to ten times larger and still access small-scale rebates.

How much a business can save

Government estimates put the saving at around 20% off the installed cost of a mid-sized commercial system. Based on figures released with the announcement, that works out to roughly:

- A 250kW system: around $68,000 off the installed cost

- A 500kW system: around $136,000 off the installed cost

- An 850kW system: around $230,000 off the installed cost

These are estimates based on government modelling, not guaranteed savings. Your actual result depends on system size, site conditions, energy usage, and current STC pricing, which moves with the market. Get a site-specific quote before budgeting against these numbers.

Who benefits most

This change targets what the industry has been calling Australia's "missing middle": businesses too large for a small rooftop system but not large enough to justify a utility-scale project. It particularly suits:

- Warehouses and distribution centres with large roof space and daytime power use

- Manufacturing facilities running equipment through business hours

- Farms, poultry sheds, and agricultural operations with high daytime loads

- Schools, childcare centres, and community facilities

- Shopping centres and multi-tenant commercial buildings

If your business runs most of its energy use during the day, a larger solar system now pays for itself faster than it could before.

How STCs work for 100kW to 1MW, and the 5-year lock

For newly eligible systems in the 100kW to 1MW range, the certificate deeming period is set at 5 years and locked at that level through to 2030. That is different to the residential scheme, where the deeming period shortens every January. The lock gives businesses more certainty when modelling return on investment, since the rebate value for a system installed this year won't be eroded by the usual annual step-down over that period.

Certificate values still move with the market, and the overall scheme winds down by 2030, so earlier installation generally means a stronger outcome.

Solar plus battery for demand charges

The SRES expansion applies to solar PV capacity only. It doesn't extend to battery storage, which remains covered separately. For businesses with high demand charges or operations that run outside daylight hours, pairing a larger solar system with commercial battery storage can extend the savings further by reducing peak demand and covering non-solar hours. This is worth discussing at the same time as your solar sizing.

Instant asset write-off and finance

The $20,000 instant asset write-off applies for the 2025-26 financial year under current law. A permanent $20,000 threshold from 1 July 2026 was announced in the May 2026 Budget but has not yet passed into law, so treat it as proposed rather than confirmed when planning your purchase timing. To claim a write-off in a given financial year, the asset generally needs to be installed and ready for use by 30 June of that year. Speak with your accountant about how this applies to a commercial solar purchase.

How to prepare before October

The expanded scheme takes effect once final regulations are in place, expected 1 October 2026. Systems need to be installed and connected on or after that date to access the higher cap. In the lead-up, it's worth:

- Getting a site assessment to confirm your roof space, orientation, and current energy usage

- Reviewing your last 12 months of energy bills to size a system against actual daytime demand

- Talking to your energy provider about network approval timelines, since larger systems can take longer to connect

- Getting quotes in now so your project is ready to move once the scheme opens

Frequently asked questions

Does this apply to my business right now?

Not yet. The expanded 100kW to 1MW cap takes effect from 1 October 2026, subject to final regulations. Systems installed before that date fall under the current 100kW limit.

Do I need a specific accreditation for the installer?

Yes. Look for a Clean Energy Council (CEC) accredited installer and confirm they are set up to handle commercial-scale STC claims.

Does this rebate cover batteries too?

No. The SRES expansion applies to solar PV only. Battery storage support is a separate program.

Is the 20% saving guaranteed?

No. It's a government estimate based on typical mid-sized systems. Your actual saving depends on your system size, site, and current certificate prices. A formal quote will give you an accurate figure.

Get a commercial energy assessment

If your business has outgrown the old 100kW cap or you've been waiting for the right moment to go solar, this is it. Get in touch for an obligation-free commercial energy assessment and find out what the expanded scheme means for your site.