Federal Government Plans to Expand the Commercial Solar Rebate: What the SRES Threshold Change Means for Your Business
The Federal Government has flagged plans to lift the Small-scale Renewable Energy Scheme's eligibility threshold from 100 kW to 1 MW — potentially opening up upfront solar rebates to a much wider range of commercial and industrial projects. Here's what's been proposed and what it could mean for larger business solar.
Most business owners know the Small-scale Renewable Energy Scheme (SRES) as the mechanism behind the upfront discount on residential solar. Far fewer know it already applies to commercial solar too — but only up to a size cap. The Federal Government has now flagged plans to lift that cap significantly, which could bring a lot more commercial solar projects within reach of an upfront rebate.
What is the SRES, and what is changing?
Under the SRES, eligible solar systems generate Small-scale Technology Certificates (STCs), which installers can sell on your behalf as an upfront discount on your system price — instead of a rebate you claim later. Currently, eligibility is capped at systems up to 100 kW. The Federal Government has announced plans to expand that eligibility threshold to 1 MW — a tenfold increase.
This is a proposed change, not yet in effect. Timing, final design and transitional arrangements have not been confirmed. Businesses planning a larger system should treat this as a development to watch rather than a rebate to bank on just yet — but it's a meaningful signal about where commercial solar policy is heading.
Why this matters for larger commercial and industrial sites
A 100 kW cap has, until now, meant that many warehouses, manufacturing sites, and larger commercial rooftops were either excluded from the SRES entirely or had to size a system down to stay under the threshold — leaving a lot of usable roof space and potential generation on the table. Lifting the cap to 1 MW would let far larger systems access the same upfront-discount mechanism residential customers already enjoy.
- Larger warehouse and distribution centre rooftops
- Manufacturing sites with high daytime energy use
- Multi-tenant commercial and industrial precincts
- Any site currently sized down to stay under the 100 kW SRES cap
How it could interact with the new NSW battery incentive
If this expansion goes ahead, it would sit alongside the new NSW battery incentive activities (BESS4 and BESS5) opening under the Peak Demand Reduction Scheme from 1 September 2026 — which already offer a higher incentive calculation when a battery is installed within 90 days of qualifying new solar. A larger SRES-eligible solar system paired with a PDRS-eligible battery could, in principle, stack an upfront solar discount with a battery incentive on the same site.
Even while a change is still proposed, it's worth modelling what a larger system could look like for your site — so you're ready to move the moment the policy lands.
— Solar Plus Electrical
What to do now
Because this change hasn't been finalised, the most useful step right now is planning, not committing. We're SAA-accredited electricians and solar installers working across NSW and Victoria — reach out and we can model what a larger system could mean for your site under both the current 100 kW SRES cap and the proposed 1 MW threshold, so you know exactly where you stand either way.
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