Everything you need to know about solar feed-in tariffs

As more Australians invest in solar panels to take control of rising energy prices, one key term keeps cropping up: solar feed-in tariffs.

If you're producing solar energy at home, understanding what a feed-in tariff is and how to make the most of it could significantly reduce your electricity bills.

This guide will break down everything you need to know about solar feed-in tariffs, how it works, how to choose the best one, and what energy providers in Australia offer the most solar-friendly plans.

Whether you’re already generating solar power or just starting to explore Australian solar plans, this article will help you maximise your solar setup and keep more dollars in your pocket.

What is a solar feed-in tariff?

A solar feed-in tariff, or FiT, is the amount your electricity retailer pays you for the unused solar energy your system exports back to the grid. When your solar panels generate more electricity than your home needs - for example, during the middle of the day while you're out - that excess energy doesn't go to waste.

Instead, it's sent to the national electricity grid, where it's used by other homes and businesses. In return, your energy retailer credits you a certain amount per kilowatt-hour (kWh) of exported electricity.

In essence, a solar feed-in tariff is a reward system that pays you for sharing your clean energy. While feed-in tariffs won't usually earn you as much as what you pay per kWh when buying electricity from the grid, it still helps lower your energy bills and improve the return on your solar investment.

How do solar feed-in tariffs work?

Here’s a simple way to understand it: imagine your solar panels generate 20 kilowatt-hours (kWh) of electricity in one day. If your household only uses 12 kWh during that time, the remaining 8 kWh are automatically sent back to the grid. If your energy plan pays you 8 cents per kWh for exported solar power, you’ll earn $0.64 that day just by exporting unused solar energy.

These credits appear on your electricity bill, offsetting the amount you owe. If you export enough energy, you might reduce your bill significantly - or even get into credit. While solar feed-in tariffs may not make you rich, these can definitely help reduce overall energy costs and stretch the value of your solar system.

Are all solar feed-in tariffs the same?

Not all solar feed-in tariffs are created equal. In fact, it can vary considerably between energy retailers and across different regions of Australia. Several factors affect how much you're paid for your excess solar, including your electricity provider, your state or territory, and even the time of day your solar system exports power.

Some providers offer a flat rate feed-in tariff, where you receive the same amount per kWh regardless of when you export energy. Others offer time-varying tariffs, which pay more during peak demand periods - usually in the early evening - and less when demand is low, such as during the middle of the day. These plans aim to match consumer behaviour with electricity demand, rewarding exports during the busiest times.

Ultimately, this means the best feed-in tariff for one household might not be ideal for another. Choosing the right plan depends on your solar system size, your daily energy habits, and how much electricity you typically export.

What’s a good feed-in tariff in Australia right now?

Across Australia, solar feed-in tariffs generally range from around 4 cents to 15 cents per kilowatt-hour. These rates have dropped over recent years, largely due to the increasing supply of solar power during daylight hours. However, these are still a valuable tool for reducing household energy bills.

In Victoria, a government-regulated minimum feed-in tariff applies, currently sitting at around 4.9 cents per kWh. Some retailers in Victoria offer even higher rates to attract solar customers. In New South Wales, Queensland, and South Australia, there’s no mandated minimum, so tariffs can vary significantly - from as little as 5 cents up to 12 or 15 cents per kWh on select plans.

It’s worth noting that Western Australia and the Northern Territory often have government-set tariffs, especially for customers on legacy solar plans.

The key takeaway? Don’t just assume your current tariff is the best. The solar market is competitive, and providers are constantly updating offers to stand out.

How to choose a solar plan that suits you

Choosing the right solar energy plan involves more than just chasing the highest feed-in tariff. While it’s tempting to pick the plan that offers the most cents per kWh, you also need to consider other aspects of the plan to ensure you’re genuinely saving money.

Start by examining your usage rates - that’s what you’re charged when you consume power from the grid. A plan might offer a great feed-in tariff, but if the usage rates are sky-high, it could cancel out any benefit. Likewise, daily supply charges - the fixed fee just for being connected to the grid - can vary and eat into your solar earnings if it’s too high.

It’s also important to look for plans that come without lock-in contracts or exit fees, giving you the flexibility to switch providers if a better deal comes along. If your solar system exports a lot of energy, a higher feed-in tariff will definitely help. But if you're using most of your solar power during the day, focus on low usage rates instead.

In short, the best plan is the one that fits your household’s usage profile, solar system size, and lifestyle.

Benefits of switching to solar power

Switching to solar isn’t just great for the environment: it’s one of the smartest financial moves you can make in the face of rising energy prices. The most obvious benefit is a significant reduction in your electricity bills. By generating your own power, you rely less on expensive electricity from the grid. And if you’re exporting excess energy, your feed-in credits help reduce what you owe even further.

Solar power is also clean and renewable, making it a sustainable alternative to fossil fuels. Using solar helps reduce your carbon footprint, which is good news for the planet and future generations.

Another major benefit is that solar can increase your home’s value. Many buyers now prioritise energy efficiency, and a solar system can be a major selling point. Plus, as battery storage becomes more affordable, you’ll be able to store solar energy for use at night, giving you even more control over your power bills.

And don’t forget there are still government rebates and incentives available across Australia to help lower the cost of installing solar panels, making it easier than ever to get started.

Which energy providers in Australia offer solar plans?

Most major energy retailers in Australia offer solar-compatible plans, but some go the extra mile with solar incentives, tools, and services. If you’re shopping around, here are a few providers to keep on your radar:

• Origin Energy offers a variety of solar plans, including some with bonus feed-in tariffs for eligible systems. It also offers solar panel and battery installation services, making them a one-stop shop for solar solutions.
• AGL has tailored solar energy plans with higher feed-in tariffs and access to smart solar monitoring. The range of energy tools makes it easy to track your usage and optimise your savings.
• EnergyAustralia offers flexible solar plans and installation support, making it a popular option for both new and existing solar customers.
• Tango Energy is known for competitive pricing and solar-friendly plans, particularly in Victoria.
• Powershop, backed by 100% renewable energy commitments, is ideal for households who want to go green and monitor solar performance through intuitive apps.
• Red Energy, owned by Snowy Hydro, is a proudly Australian provider offering solid customer support and solar-inclusive options.
• Dodo Energy also supports solar customers with basic feed-in tariffs on budget-friendly plans - perfect for those looking to keep costs low without sacrificing value.

Each of these retailers offers something different, so it’s worth comparing them based on both solar incentives and the overall value of the plan.

Make your solar work harder for you

Solar power is one of the best ways to fight back against rising energy costs - and understanding your solar feed-in tariff is a big part of that equation. By exporting energy and getting paid for it, you can stretch your savings even further and turn your rooftop into a money-saving machine.

But like all things energy-related, not all solar plans are equal. It’s important to regularly review your feed-in rate, check your daily usage and supply charges, and compare providers to ensure you’re getting the most value from your system. The good news? You don’t have to figure it all out on your own.

Ready to compare solar plans and save?

Whether you’ve already got solar panels or are thinking about making the switch, we can help you get the most out of your solar investment. At Compare Energy, our team of Aussie energy experts is here to help you find the best solar-friendly energy plans, from the biggest providers to the most affordable options.

Give us a call on 1300 790 106 and we’ll talk you through your options in plain English. We compare solar feed-in tariffs, usage rates, contract terms, and more to find the plan that suits your home, lifestyle and budget.

It’s fast, free and 100% Aussie-owned. Make your solar power go further - call us today!