How Much Solar System Costs in Sydney

Often, this is the question that Australians have how much does the solar system costs? There are myriad solar panels and inverters on the market; however, the system costs depend on various factors such as panel brands, type of panels, inverter brands, type of inverters, components, installation and customer service. This makes the combination of overall system costs.

As you have observed and noticed, many companies are offering a system size as low as $3000 for 6.6kW, but the big question remains are they worth it?

Let’s delve deeper and find out

But beware of the companies offering cheap quotes. We have made your process easier.

Do check our blog, “Shortlist the Best and Reliable Solar Installation Company”

How much does Solar System Costs?

There are various system sizes that consumers can opt for. The most common sized 6.6kW and 7.7kW solar systems would cost between $6,000- $10,000 in NSW. The prices can go up for high-end products like REC Alpha solar panels with Enphase IQ7A microinverter.

The below table shows the average solar system costs for NSW in 2022. The costs are after STC and include the entire cost of the system and GST. 

How the solar system has become affordable for consumers?

Back in 2007 and 2008, solar systems were pretty expensive and only a few people could afford them. Moreover, the solar system concepts were not popular and consumers weren’t aware of the solar systems. 

However, between the early 2008s and late 2010s, the solar system started to take off and the government introduced premium feed-in tariffs of up to $0.60c/kWh for solar energy exported into the grid. This pushed the market sentiments amongst consumers and solar installation companies.

In 2011, the government introduced the federal rebate program which provided a massive relief to the upfront cost of a solar system. This was a major turnaround in the solar industry and motivated solar companies, and product manufacturers to roll out newer products with better technologies and excellent customer service.

As of 2021, Australia has around $3 million rooftop solar systems, which equates to 1 in 4 homes having solar systems. What’s more astonishing is NSW has the highest number of rooftop solar systems with 112,223 solar systems installed.

Why the solar system costs differ for the same system size?

As discussed already, there are various factors to consider before we can derive the cost. There have been many instances where customers often compare the quotes for the same system size and purchase the solar system just by looking at the quotes. However, the brand of solar panels, inverters and type of solar panels and inverters play a very crucial role. Another important factor is the installation costs where it is imperative to have a smooth installation with fabulous craftsmanship and excellent workmanship.

Let’s explore from below table for Three Phase, Single Storey Pricing for the Budget solar system to the Premium solar system

As you can observe from the above table, how the prices differ based on solar panels and inverter brands. Therefore, it is important not to just compare the quotes but filter your choices based on the solar panels and inverter brands. Finally, customer service is not to miss. After all, you want to experience impeccable customer service and can get what you want from the solar installation company.

Key External Factors that impact the cost of Solar panels and Inverters

• Economies of Scale
  Over the years, solar panel manufacturers have been able to achieve large economies of scale due to process automation, skilled labour, heavy investment in R&D, faster supply chain management and innovations in technologies. There are countries like the USA, India and China where the demand for solar systems is massive which drives the companies to sell the products by leveraging their resources and huge investments from financial and PE investors. Nevertheless, Australia has gained popularity and in the last 3 years, the solar industry has picked up at a faster pace than it was before. There are suppliers and distributors locally that drive the prices further.
• Solar Rebate
  The solar rebate from the Federal government is pushing the prices every year and a time will come when the prices will spike once the rebate is phased out by 2030. Simultaneously, the electricity companies have played smart tactics in reducing the feed-in tariff over the years from $0.20c/kWh to as low as $0.05c/kWh.
• Volatility in Australian Dollar
  All the components of the solar system are imported from overseas. The price of AUD against USD is highly volatile and the manufacturers pass on the costs to the distributors which then are passed on to the consumers. Therefore, solar installation companies often have solar package proposal validity between 7 to 14 days.
• Supply Chain and Logistics
  The supply chain and logistics disruptions can push the pressure on prices. Few examples like COVID-19 lockdown, geopolitical tensions, war, demand and supply gap, demand from other countries etc. Over the years, the shipping costs have risen by more than 101% which is finally affecting the final cost to manufacture and supply the solar panels and inverters.
• Intense competition and Cheap quotes
  The Australian solar industry is one of the highly competitive sectors and to cut-throat the competition, the companies are selling solar systems at a thin margin. Furthermore, many solar installers are doing shoddy installations and forgiving the quality of work posing a major threat to the customer’s health and their property. Finally, we have more than 700 companies that went into liquidation due to fake promises, unethical practices and a lack of sincerity with no intention to serve the customer.