Australian households with rooftop solar systems are facing a significant reduction in their electricity bill credits, as major energy retailers across New South Wales, Queensland, and South Australia slashed solar feed-in tariffs (FiTs) from 1 July 2026. For some customers on standard retail contracts, the export rate has plummeted to as low as 0 cents per kilowatt-hour (c/kWh), marking a critical shift in the economics of rooftop solar.
This widespread reduction reflects the increasing abundance of solar power in the grid during daylight hours, which drives down wholesale electricity prices at midday. While beneficial for overall grid stability and affordability, it means less financial compensation for households exporting excess solar energy.
Major Retailers Implement Cuts
Several prominent energy providers have adjusted their solar feed-in tariffs, impacting thousands of customers. AGL, one of Australia’s largest retailers, confirmed that customers on its Standard Retail Contracts will receive a 0 c/kWh feed-in tariff from 1 July 2026.
EnergyAustralia customers in New South Wales have seen their flat rate FiT decrease from 4c/kWh to 3c/kWh as of 1 July 2026. Momentum Energy also implemented cuts across multiple states:
| State | Previous FiT (c/kWh) | New FiT (c/kWh) from July 2026 |
|---|---|---|
| New South Wales | 5 | 3 |
| Queensland | 2.9 | 2 |
| South Australia | 2.5 | 0.8 |
| Victoria | 1.1 | 0.9 (after 1 August 2026) |
Source: Momentum Energy, July 2026
In regional Queensland, serviced by Ergon Energy, the FiT rate dropped from 8.66c/kWh to 6.006c/kWh from 1 July 2026. This represents a substantial decrease from the 2024-25 rate of 12.377c/kWh.
Even the Independent Pricing and Regulatory Tribunal (IPART), which sets a non-mandatory benchmark range for NSW feed-in tariffs, saw its guidance fall from 4.8–7.3c/kWh last year to 3.4–6.5c/kWh for 2026–27. This benchmark serves as a reference point, with retailers able to offer less.
“Across 2025 and 2026, regulators and retailers have pushed export rates to near-zero — and in one major case, to exactly zero for default customers. The direction is unmistakable, and it’s documented at the source.”
Victoria, which removed its minimum FiT floor from 1 July 2025, continues to see retailers setting their own rates, often resulting in lower returns for solar owners.
Why Feed-in Tariffs Are Falling
The primary driver behind these reductions is the overwhelming success of rooftop solar installations across Australia. The country boasts one of the highest per capita rates of solar adoption globally, leading to a surplus of electricity in the grid during peak solar generation hours. This abundance pushes wholesale electricity prices to very low, and sometimes even negative, levels.
While this cheap midday power benefits consumers who can shift their usage, it diminishes the value of exported solar electricity. The Australian Energy Regulator (AER) has also introduced the Solar Sharer Offer from 1 July 2026 in NSW, SA, and SE Queensland, providing eligible households with three hours of free electricity during midday. This initiative aims to encourage daytime consumption and better utilise the solar surplus, further impacting the economic rationale for high FiTs.
Impact on Solar Households and Future Strategies
For households with existing solar panels, these reduced FiTs mean a lower credit on their electricity bills for power sent back to the grid. This makes self-consumption of generated solar power more crucial than ever. Using electricity directly from your panels during the day – for appliances, air conditioning, or hot water – avoids purchasing grid power at significantly higher retail rates (typically 30-45 c/kWh).
Home battery storage systems are increasingly becoming a viable solution to maximise self-consumption. By storing excess solar generated during the day and using it in the evening, households can reduce their reliance on the grid during peak demand periods when electricity prices are highest. This strategy allows solar owners to maintain significant savings despite lower FiT rates. For a deeper dive into optimising your solar system, refer to our guide on Maximise Your Solar Savings in Australia 2026: Unlock $1,500+ Annually with Smart Strategies.
Additionally, the federal Cheaper Home Batteries Program continues to offer upfront discounts on eligible battery systems, making them more accessible for Australian households. Exploring options like these can help mitigate the impact of reduced FiTs and enhance long-term energy independence. For a comprehensive overview of battery options, see Best Home Solar Batteries in Australia 2026: Models, Prices & Post-May Rebates.
The shift in feed-in tariffs underscores the evolving nature of Australia’s energy market, where distributed solar generation plays a central role. Adapting consumption patterns and investing in storage solutions will be key for solar owners looking to maintain their savings in this new landscape.