Australia’s commercial solar market is about to receive a major boost.
On 5 August 2026, the Australian Government announced plans to significantly expand the Small-scale Renewable Energy Scheme (SRES), allowing much larger commercial solar installations to access the scheme’s upfront solar incentive.
For Australian businesses — particularly those operating warehouses, factories, workshops, offices, retail premises and agricultural facilities — the change could substantially reduce the upfront cost of installing solar.
The government estimates the expanded incentive could reduce eligible commercial solar installation costs by around 20%.
For many businesses, this could make the numbers around commercial solar considerably more attractive.
What Is Changing?
Until now, solar PV systems eligible under the Small-scale Renewable Energy Scheme have generally been limited to a maximum capacity of 100kW.
Under the proposed changes, that limit will increase dramatically:
Current maximum: 100kW
Proposed maximum: 1MW (1,000kW)
That means solar installations up to 10 times larger could potentially receive the upfront incentive available through Small-scale Technology Certificates, or STCs.
The Australian Government intends the new arrangements to apply to eligible mid-scale solar systems installed from 1 October 2026, subject to the necessary regulations being finalised.
This is particularly significant for medium and larger businesses that previously sat between the residential/small-commercial solar market and traditional large-scale renewable projects.
How Does the Commercial Solar Incentive Work?
The scheme isn’t simply a cash rebate paid directly to the business.
Eligible renewable energy systems can generate Small-scale Technology Certificates (STCs).
These certificates have a financial value. Businesses can either manage the certificates themselves or, more commonly, assign the right to create them to a registered agent in exchange for an upfront reduction in the price of the solar installation.
How Much Could a Business Save?
The Australian Government estimates the expanded scheme could reduce the upfront installation cost of eligible commercial, industrial and agricultural solar systems by approximately 20%.
Government examples indicate potential upfront incentives of approximately:
- 250kW solar system — around $68,000
- 500kW solar system — around $136,000
Actual incentives will vary depending on factors including system size, location, installation date, certificate values and the final rules applying to the expanded scheme.
For businesses considering a substantial solar investment, these numbers could materially change the project’s payback period and return on investment.
Why Commercial Solar Can Make So Much Sense
Commercial buildings are often extremely well suited to solar.
Unlike many residential properties, businesses frequently consume their largest amount of electricity during daylight hours — exactly when a solar system is producing electricity.
Think about a workshop, manufacturing facility or warehouse operating from approximately 7:00am until 5:00pm.
During those hours there may be:
- Air conditioning
- Machinery
- Motors and pumps
- Refrigeration
- Office equipment
- Computers and servers
- Lighting
- Production equipment
- Electric vehicle charging
- Other significant electrical loads
Instead of purchasing all that electricity from the grid, appropriately designed solar allows the business to generate and consume a portion of its electricity directly from its own roof.
The financial benefit isn’t only about selling electricity back to the grid.
For many commercial installations, the biggest saving comes from avoiding the need to purchase electricity in the first place.
Who Could Benefit From the New Scheme?
The expanded commercial solar incentive could potentially benefit a broad range of Australian organisations, including:
- Warehouses and distribution centres
- Manufacturing facilities
- Workshops
- Retail centres
- Offices
- Medical and professional facilities
- Schools and educational facilities
- Sporting clubs
- Agricultural businesses
- Farms and farm sheds
- Cold-storage facilities
- Body corporates and commercial property owners
- Community organisations
Businesses with substantial daytime electricity consumption and available roof space may be particularly well positioned.
Solar Systems Up to 1MW Opens Up New Opportunities
Increasing the SRES threshold from 100kW to 1MW is significant.
A 100kW solar system is already considerably larger than the average residential installation.
Systems between 100kW and 1MW can potentially service businesses with much greater electricity consumption, providing substantially more opportunity to reduce grid electricity purchases.
It also means commercial property owners with large unused roof areas may have an opportunity to turn that space into a productive energy-generating asset.
When Does the New Commercial Solar Scheme Start?
1 October 2026
Importantly, the changes are subject to regulations being in place.
The Clean Energy Regulator has also indicated that additional design, installation and compliance requirements for mid-scale systems are still being considered, with further details to be released before commencement.
Businesses should therefore obtain professional advice rather than assuming a proposed installation will automatically qualify.
Should Your Business Consider Commercial Solar?
If your business has:
- High electricity bills
- Significant daytime electricity consumption
- Large warehouse, workshop or commercial roof space
- Plans to remain at the premises for several years
- Increasing electricity requirements
- Plans for EV charging or electrification
- An interest in reducing reliance on grid electricity
With the proposed expansion of the federal solar incentive to systems as large as 1MW, businesses that previously found larger solar installations difficult to justify may want to revisit the numbers.
Talk to HJR Electrical About Commercial Solar
At HJR Electrical, we can help businesses understand their energy consumption and determine whether commercial solar — and potentially battery storage — could provide worthwhile savings.
Our team can assist with:
- Commercial solar system design
- Energy usage assessment
- Solar and battery solutions
- Commercial switchboard and electrical upgrades
- Solar monitoring and energy management
- Battery storage systems
- EV charging infrastructure
