Is Solar Worth It in NSW?

Written by Jacob Ramilo, Last reviewed 2026. This guide provides general information only. See how we calculate the estimates.

Solar Conditions in NSW

The Small-scale Renewable Energy Scheme (SRES) provides an upfront discount based on your postcode and system size^[2]. IPART's all-day benchmark for 1 July 2026 to 30 June 2027 is 3.4 to 6.5c/kWh^[6]. Retailers do not have to follow it, so compare the full plan.

The average NSW household uses about 15.3 kWh a day^[5]. Actual usage varies by household size, gas use, pool pumps, EVs, and air conditioning. That's enough demand for a 6.6kW system to cover a solid chunk of your consumption, especially if you can shift some usage into daylight hours.

System Costs in NSW

Prices for a quality 6.6kW system in NSW vary by installer, panel brand, and roof complexity. The federal STC scheme provides an upfront discount based on your postcode and system size^[2].

Larger systems like 8kW or 10kW cost more but can deliver better savings if your household has higher daytime usage. Many quotes use 6.6kW as an example size, but the right system depends on your usage, roof space, export limits, and budget.

Feed-In Tariffs in NSW

IPART's 2026–27 all-day benchmark is 3.4 to 6.5c/kWh^[6]. Retailers may offer less, more, or no FiT. A higher headline FiT can also sit beside a higher import rate or daily charge, so compare annual cost rather than one line item.

The real value in solar comes from self-consumption. Every kilowatt-hour you use directly saves you the retail rate (we model self-consumed solar at approximately $0.30 per kWh in our worked example) rather than earning the export rate. That gap makes daytime usage the single biggest driver of solar value.

Electricity Prices in NSW

The AER Default Market Offer sets the maximum standing-offer price for residential electricity in NSW^[7]. Because self-consumed solar offsets the household's retail electricity rate, the DMO price provides a benchmark for calculating solar savings. Every price increase raises the value of every self-consumed kilowatt-hour. Homes that run air conditioning, pool pumps, or home offices during the day feel this benefit most.

The NSW Checks That Can Change the Quote

• Distributor approval: ask which export limit Ausgrid, Endeavour Energy or Essential Energy will approve. It may be lower than your inverter capacity
• Apartment ownership: check the shared roof, metering and owners corporation approval. The current NSW grant helps eligible apartment projects^[4]
• Two-way network tariffs: ask which export tariff your distributor will assign. Include it with your retailer FiT when you estimate savings
• Hot western suburbs: ask your installer to account for roof temperature, shade and inverter placement. West-facing panels may suit afternoon air conditioning

Worked Example: A Sydney Home

Assume you use 15.3 kWh a day and install a 6.6kW system for $5,500 after STCs. We estimate that it generates 9,200 kWh a year. This is a modelling assumption. If you use 40% directly and export the rest at 5c per kWh, the estimate looks like this:

The $5,500 cost, generation, 40% self-consumption and tariffs are modelling assumptions. If self-consumption falls to 20%, the annual benefit is about $920 and simple payback stretches to roughly 6.0 years. Export limits and two-way network tariffs are not included in this example.

This guide is for informational purposes only and does not constitute financial or investment advice. Solar savings estimates vary by household. Always consider your own circumstances and consult a qualified professional before making a purchase decision.