source: Clean Energy Regulator
STP Percentage - STC Target
Under the Small-scale Renewable Energy Scheme, liable entities source and surrender small-scale technology certificates (STCs) to meet scheme obligations.
The small-scale technology percentage (STP) helps calculate the amount of STCs liable entities surrender each year. This amount should equal the predicted amount of STCs created. It also accounts for previous under or over-creations.
Learn about how the STP impacts the carbon market by reading our Quarterly Carbon Market Reports.
Solar battery STCs are not included in STP
Solar batteries are eligible for STCs under the Small-scale Renewable Energy Scheme. Solar batteries won’t be added to the STP as the Department of Climate Change, Energy, the Environment and Water purchases STCs equivalent to all battery STC creations.
No costs will be passed onto energy retailers or households.
Read more about solar batteries.
Setting the small-scale technology percentage
Each year, we recommend a percentage to the Minister for Climate Change and Energy. We use data or estimates for matters the minister must consider. These matters are:
- estimated STC creations for the year
- estimated relevant acquisitions of electricity for the year
- the cumulative adjustment
- estimated exemptions.
The Minister may also consider other matters when determining the STP.
The STP must be set by 31 March each year, otherwise a default percentage is used.
Estimated STC creations
The 2026 STP is based on the average of consultants’ high scenario forecasts. The high scenario was used to capture the expected increase in demand for small-scale solar installations due to the Cheaper Home Batteries Program.
For 2026, the estimated number of STC creations is 24.1 million, excluding those created under the Cheaper Home Batteries Program.
Learn more about our consultants' forecast in the STP modelling reports.
Estimated relevant acquisitions of electricity
A relevant acquisition of electricity is when a liable entity buys wholesale electricity. We estimate based on the sum of acquisitions reported by liable entities 2 years before the setting year. We use data from 2 years before the setting year as this data has been finalised and will not change in the future.
Under or over-estimating has a minor impact on the STP calculation. Estimated relevant acquisitions of electricity in 2024, used in the 2026 STP calculation, are 219,610,453 MWh.
Cumulative adjustment
The cumulative adjustment accounts for over or under supply of STCs in previous years. We subtract the sum of all STCs surrendered from the sum of all STCs created. We add this figure to the STC creations estimate.
In 2025, STC creations were below required surrenders. This means the 2026 STP cumulative adjustment is negative at -2,617,218 STCs. The cumulative adjustment is based on data up to the end of November 2025 plus an estimate for the remainder of the year.
In the cumulative adjustment, we also consider the:
- 659,564 STCs changed to large-scale generation certificates
- 562,195 STCs flagged as voluntarily surrendered in the REC Registry.
Estimated exemptions
Businesses receive exemption certificates for electricity used in emissions-intensive trade-exposed (EITE) activities. They exchange these certificates with their electricity retailer (liable entity) to reduce electricity costs. The liable entity surrenders the exemption certificates to reduce its scheme responsibility.
We estimate the EITE exemptions and minus the amount from the relevant acquisitions estimate each year. Like relevant acquisitions, we use data from 2 years before the setting year.
Estimated exemptions for 2024, used in the 2026 STP calculation, are 35,462,777 MWh.
Non-binding small-scale technology percentage
We must publish non-binding STPs for 2 years following the setting year. This gives us an idea of what the STP could be in those years. This is not accurate when there is a large difference between STC creations and STC estimates. Non-binding estimates are a general guide only.
These estimates don't bind us or affect a liable entity's liability.
As with the STP, STC creations are the average of our consultants' high forecasts:
- 19.8 million STCs for 2027
- 14.3 million STCs for 2028.
