Deemed Solar VEECs for C&I: Save 35% On Upfront Cost of Solar

A new incentive announced under the Victorian Energy Upgrades (VEU) program will reduce the upfront cost of installing solar systems for C&I sites by up to 35%.

Hear more from Smart MD Huon Hoogesteger, and Julian Freeland, ESG Manager of Ventora, interviewed by Prue Bentley from ABC Radio’s Victorian Statewide Drive.

Head to Smart’s YouTube to hear this interview in full or head to our LinkedIn to listen to an edited segment.

It's strength and certainty in terms of what your operating costs will be moving forward, because you've got a reduced input through energy, which then can help soften the blow of exploding costs for labour or materials.

- Julian Freeland, Ventora ESG Manager

Prue Bentley, ABC Radio:

Now there is a dizzying array of rebates for households to install solar and even batteries. I'm sure you've seen them. Maybe you've taken advantage of them, but until now, not a lot to help businesses make the switch. But there is a move that could be a game changer for regional businesses. Some significant incentives to go solar. With me now is Huon Hoogesteger, who's the MD of Smart Commercial Solar. Huon, good afternoon. What's been announced?

Huon Hoogesteger, Smart Commercial Solar:

Well, the Victorian government has basically modified one of their existing schemes called VEECs, which was really good for commercial, but it was difficult to get hold of because it took about 18 months to actually extract the rebate. And it was not deemed. It was a measurement criteria. So, it was complex.

But they've made it really simple. Basically, they've made it a deemed rebate, which means that we know that solar is going to produce X amount of power, therefore it's eligible for X amount of rebate, rather than having to prove it over 18 months or 12 months. And that basically has brought forward a whole lot of money for businesses.

Prue:

This is kind of an upfront cost, because it is pretty expensive for many businesses to get the amount of solar that they might need.

Huon:

I think businesses have struggled to comprehend the value that solar has presented. I mean, there's already STCs and LGCs. STCs is for anything under 100kW, LGCs is for projects over 100kW. Once again, LGCs have been paid out over time and the value has always fluctuated as well, which makes it an uncertain rebate. And that's why something like this is very, very welcome because it's a known amount. Businesses can bank on it. Certainty is what businesses are looking for, and we haven't really had that commercial for a long time.

Prue:

And how much is it valued at? So, what's the sort of the top rebate you can get?

Huon:

Yeah, it's quite amazing actually. You can get up to $38,000 at the moment with the current value of VEECs, for 200kW of solar. Now, it reduces the smaller the system is. But the great thing about this product is that you can actually stack it alongside STCs or LGCs. Let's say your business, you need 100kW to 200kW.

If you're going for the 200kW system, you'd be getting your $38,000 plus ongoing. Over time you'd get your LGC rebates of $50,000, let's say. So, the impact is roughly around about up to 35% of a solar system, which is an incredible value add and shortens the payback down to basically four years, which is 25%.

Prue:

Julian Freeland is with us, manager with a company called Ventora, an Australian door and window manufacturer based in Victoria. Julian, good afternoon. I understand that you've taken advantage of this. Tell me how it has impacted your business.

Julian Freeland, Ventora:

We are in the process of trying to explore what deemed VEECs will mean for us. But at the moment, we're looking to expand the plans solar that we were initially going to install. It's great. It just makes solar more affordable.

Prue:

And what sort of impact has it had on your energy costs?

Julian:

Putting solar in any business environment produces energy costs. And if you partner with a credible solar partner, you can reduce them by up to, I think about 40%.

Prue:

Well, but you have to weigh that up with the upfront costs, don't you?

Julian:

Absolutely. And that's often been a bit of a stop to getting into solar. So, this deemed VEECs program is a very welcome opportunity. And as Huon mentioned, it's an enabler to expand and explore solar, which often was unaffordable.

Prue:

Okay. And, you know, can you put a dollar figure on how much the rebates have been for your business?

Julian:

Well, as Huon mentioned, there's a 35% discount on the upfront costs. And it's a real sweetener for us in terms of so in terms of we're looking at going for 200kW on one of our facilities. So that's a $38,000 discount that enables us to embrace the opportunity, a lot quicker than we had initially planned.

Prue:

Now we know Julian, in manufacturing, it is a tricky business in Australia. And I was only just talking with a manufacturing business last week who was saying that, you know, cutting costs and making sure that we're efficient and we're competitive is really, really important. Is this part of that process for you?

Julian:

Absolutely. It's strength and certainty in terms of what your operating costs will be moving forward because you've got a reduced input through energy, which then can help soften the blow of exploding costs for labour or materials.

Prue:

Yeah. There's only so many levers that you can actually pull. I understand, so, this is one of them.

Julian:

Absolutely. Look, at manufacturing, we're all suffering at the moment. There's such uncertainty. People aren’t making, certainly, windows and doors. It's not that I wake up in the morning and want to buy some new windows or doors. Or if I'm building a house, where can I get the best return or the best quality over cost? So, if we can keep it in Australia and keep Australian jobs, through subsidised energy such as this opportunity presents, it's a fantastic way forward for everyone. We've got jobs created for manufacturing here in Australia, for the desperately needed homes.

Prue:

Julian, thank you very much for your time. Huon, just back to you. How can businesses interested in this get more information?

Huon:

Well, we've got, obviously a bunch of information on our website [and] government websites. And I can point to Ecovantage, who are a certificate trader. They have a really cool little calculator to help you calculate the value of your rebate. So, you know, they've got a little tool to help you understand what is important for your business.

But, yeah, I just want to echo how important this is for business. Julian pointed it out really well. We've seen a lot of businesses struggling over the last year significantly. Energy costs being a key driver of the slowdown in business. And this is going to help businesses cut their costs, typically by 40%. And quite often, about 40% can come in almost for free now. So, it's pretty exciting.