When it comes to solar solutions, there’s often a key question: should you invest in rooftop solar for your home, or support large-scale solar farms that feed the grid? Both options provide unique benefits, but they cater to different needs and lifestyles.
Rooftop solar provides households with energy independence and long-term savings. On the other hand, solar farms deliver large-scale environmental impact and greater accessibility for renters and those without sustainable rooftops.
Whether you’re a homeowner looking to maximise savings or a renter wanting to support renewables, there’s a solar solution for you.
What are solar farms and rooftop solar?
There are two primary forms of solar energy in Australian households and communities: solar farms and rooftop solar. While both harness the sun’s power to generate electricity, they differ significantly in scale, infrastructure, and how they deliver benefits.
What are solar farms?
Solar farms are large-scale installations that use thousands or even millions of solar panels to generate electricity. They are typically owned by energy companies or cooperatives and are connected to the national grid. The electricity produced is distributed across homes, businesses, and industries, reducing reliance on fossil fuels.
Key features of solar farms:
· Size: They cover extensive areas, usually in rural or semi-arid regions, where sunlight is abundant.
· Ownership: They’re operated by companies or community groups, not individual households.
· Electricity distribution: The power feeds into the grid, benefitting everyone connected to it.
There are now many solar farms across Australia. Below are some of the solar farms per state:
· Broken Hill Solar Plant (53MW)
· Nyngan Solar Plant (102MW)
· Coleambally Solar Farm (150MW)
· Bannerton Solar Farm (88MW)
· Numurkah Solar Farm (100MW)
· Kiamal Solar Farm (350 MW)
· Hayman Solar Farm (50MW)
· Lilyvale Solar Farm (100MW)
· Columboola Solar Farm (162MW)
· Port Augusta Renewable Energy Park (99MW)
· Bungala Solar Farms 1&2 (275 MW)
· Chichester Solar Farm (60MW)
· Merredin Solar Farm (132MW)
In the Northern Territory (NT), Australian Capital Territory (ACT), and Tasmania (TAS), there are a few solar farms but none of the operational or under-construction projects exceed 50MW.
There are also many under-construction solar farms in NSW, WA, VIC, QLD, and SA.
What is a rooftop solar?
A rooftop solar involves installing solar panels on individual homes or commercial buildings. They are owned and maintained by the property owner and are designed to generate electricity directly for the building they’re installed on.
Key features of rooftop solar:
· Scale: They are small and can be customised for a household or business.
· Ownership: Owned by individual property owner, who benefits directly from the energy generated.
· Energy independence: Allows households to generate their own power, reducing or eliminating their grid reliance.
Currently, Australia has one of the highest rates of rooftop solar adoption in the world. In April 2024, the Clean Energy Council (CEC) reported that rooftop solar accounts for 11.2% of Australia’s electricity supply.
Costs and savings: Which is better for you?
Cost is a critical factor when choosing between solar farms and rooftop solar. Both options have unique financial implications, and understanding these can help you make a decision based on budgets and energy costs.
Upfront costs
For those considering rooftop solar, the biggest financial barrier you may face is the initial setup cost. The price for installing solar panels on a home usually ranges from $3,000 to $10,000, depending on the size of the system, the type of panels, and whether additional equipment, like solar batteries, is included.
Despite the significant upfront investment, there are still a few ways to reduce the financial burden. The Australian government provides several financial incentives to make solar more affordable, such as the Small-scale Renewable Energy Scheme (SRES), which provides rebates that can lower installation costs.
Homeowners can also claim Small-Scale Technology Certificates (STCs), which can reduce the price of a solar system. The value of these certificates fluctuates but usually provides around $2,000 to $4,000 in savings for a standard home system.
Many solar companies also provide financing to help homeowners spread the cost over several years. While this adds to the overall cost, it makes rooftop solar more accessible to those who can’t afford the full amount upfront.
As for the upfront costs of solar farms, theythere are generally minimal or nonexistent. Instead of installing solar panels on your property, you pay a subscription fee to an energy company or community solar program, which buys the electricity generated by the farm. These costs are often bundled into your energy bills, where you pay for the electricity at a potentially lower rate than traditional power sources.
In a community solar program, you can subscribe to receive a portion of the power produced by the solar farm. The fees range from $10 to $30 per month, but vary depending on the farm and the energy provider.
Unlike rooftop solar, there’s no need to pay for the installation or maintenance of solar panels. However, this means you won’t be directly benefiting from government rebates or tax incentives.
Ongoing costs and savings
Once rooftop solar panels are installed, you don’t need to worry so much about solar maintenance. Plus, the cost of running them is very low. The main ongoing expenses are related to system maintenance and occasional repairs, which vary between $200 and $400 per year, depending on the system’s age and condition.
In June, the CEC proposed a national strategy to drive the adoption of rooftop solar, home battery storage, and electrification in Australia. This initiative, detailed in the Powering Homes, Empowering People roadmap, highlights significant savings for households and the broader economy.
For instance, every Australian household could save up to AU$ 71 annually on energy bills, even without directly installing Consumer Energy Resources (CER). Over time, this approach could deliver AU$22 billion in taxpayer savings by 2050 while creating 18,200 new jobs in manufacturing, sales, design, and installation.
As for the long-term financial benefits of rooftop solar, they are:
· Electricity bills: This is the primary financial benefit if you have rooftop solar. A well-sized solar system can reduce or even eliminate electricity bills. In June, the CEC proposed a national strategy to boost the.
· Feed-in Tariffs (FiTs): In many states, homeowners with rooftop solar systems can sell excess energy back through the grid through FiTs.
· Return on investment (ROI): A typical rooftop solar system in Australia pays for itself within 4 to 7 years. After this period, homeowners enjoy years of virtually free electricity, with systems often lasting 25 years or more.
For solar farms, the ongoing costs are more predictable but less rewarding. Since the energy produced is sold back to the grid, your subscription fees are generally used to cover the cost of the farm’s operations, with minimal fluctuation.
· Lower energy bills: Subscribing to a solar farm can lower energy costs by 5% to 20% compared to traditional power bills.
· No direct ownership benefits: While subscribers can support the renewable energy transition, they won’t receive any financial incentives directly. The savings come from the reduced rates on electricity, but they’re not as significant as those from owning a rooftop system.
· Energy stability: A key benefit of solar farms is energy price stability. Since the price of solar energy is generally fixed and less susceptible to price hikes, it provides long-term security against rising electricity costs.
Which provides more savings?
If you can afford the upfront cost of a rooftop solar, it provides the highest long-term savings and energy independence. After paying off the initial investment, your household could enjoy years of reduced or eliminated electricity bills.
On the other hand, if you’re renting or don’t have a suitable roof for solar panels, subscribing to a solar farm is a more accessible way to benefit from renewable energy. While the savings are less significant, they provide an opportunity for individuals to lower their carbon footprint without the high upfront costs.
The choice between rooftop solar and solar farms ultimately depends on your circumstances, financial capacity, and environmental goals. Rooftop solar provides unparalleled energy independence and significant long-term savings, making it a compelling choice for homeowners ready to invest upfront. Meanwhile, solar farms democratise renewable energy, providing access to clean energy for renters, apartment dwellers, and those unable to install rooftop solar systems.
Energy Matters has been in the solar industry since 2005 and has helped over 40,000 Australian households in their journey to energy independence.
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