Heat Pumps, Hot Water and Solar: Electrifying Your Tasmanian Home for Tasmanian Households

Yes, for most households, installing solar panels is one of the smartest investments you can make. The goal is to use the solar power you generate yourself, because buying electricity from the grid costs about three times more than the credit you get for selling your excess solar power back. By using your own solar power, you significantly cut your power bills, and a well-designed system can pay for itself in as little as 4-6 years.

The key is “self-consumption”. With Aurora Energy’s standard retail tariff sitting around 28-30 cents per kilowatt-hour (c/kWh), every kilowatt-hour of solar power you use at home is a direct saving of that amount. The feed-in tariff you receive for power you export to the grid is much lower, regulated at 9.276 c/kWh from 1 July 2026. This difference is why shifting your energy use into the daytime makes solar so valuable in Tassie.

What size solar system should I get?

For a typical Tasmanian home looking to future-proof, a system with around 13kW of panels paired with a 10kW inverter is now the smart default. This might sound big, but it’s designed for a future where your home is fully electrified with a heat pump for heating, a heat pump hot water system, and an electric vehicle (EV) charging in the driveway.

The old standard: For years, the 6.6kW system was the go-to. It’s still a decent choice for smaller households with low electricity usage who don’t plan on adding an EV or major electric appliances.
The new standard (~13kW): This larger size prepares you for the future. It generates significantly more energy, especially on the less sunny days common in Tasmania, ensuring you can run your home and charge your car from the sun for more of the year.

Thankfully, Tasmania’s network rules are well-suited for this. TasNetworks allows a 10kW inverter on a standard single-phase connection, which most Tasmanian homes have. This means you can install a powerful, future-ready system without needing an expensive three-phase power upgrade.

How do solar rebates work in Tasmania?

The main financial incentive is the federal government’s Small-scale Renewable Energy Scheme (SRES), often called the “solar rebate”. This isn’t a cash payment, but an upfront discount on the cost of your system.

It works by creating Small-scale Technology Certificates (STCs) based on your system’s size and location.
Tasmania is in STC Zone 4. This means our solar installations are deemed to produce slightly less energy over their lifetime than sunnier zones on the mainland, so we get a few less certificates than a system of the same size in, say, Queensland.
Your solar installer handles the paperwork and applies the discount directly to your invoice, so you only pay the final, lower price. The value of STCs fluctuates, but it can reduce the total cost of a quality system by thousands of dollars.

It’s important to know that this federal rebate is the only one available. There are no separate Tasmanian state government rebates for installing solar panels.

Should I get a battery with my solar?

A battery is a fantastic piece of technology, but the financial case in Tasmania is more complex than on the mainland. A battery lets you store your excess solar energy generated during the day and use it at night, which is the ultimate form of self-consumption. It also provides valuable backup power during blackouts.

However, the payback period for a battery is typically longer here, often in the 7-12 year range. This is because Tasmania’s grid electricity isn’t as expensive, and our feed-in tariff is more reasonable than in many other states, which slightly reduces the savings a battery can create.

A new federal government program may help. The Cheaper Home Batteries Program, starting from 1 July 2025, is designed to provide a discount on eligible battery systems when paired with solar. For a typical battery, this could reduce the upfront cost by around 30%, though the exact amount depends on the battery size and the program’s tapering structure through to 2030. Eligibility conditions will apply.

Battery or No Battery? A Quick Guide

Get a battery if: You want to maximise your energy independence, need backup power for outages, and are comfortable with a longer-term return on investment. It’s the final piece of the home electrification puzzle.
Wait on a battery if: Your primary goal is the fastest possible payback on your solar investment. You can always add a battery later; just ensure you install a “hybrid” inverter that is battery-ready from day one.

While no major energy retailers currently offer a Virtual Power Plant (VPP) program in Tasmania, some homeowners with batteries and a wholesale electricity retailer can benefit by automatically charging their battery when grid prices are very low or even negative, and using that stored power to avoid high-priced evening peaks.

How can I get the most out of my solar system?

Making the most of your solar investment is all about shifting your energy usage to the middle of the day when the sun is shining. This is how you maximise your self-consumption and minimise the amount of expensive electricity you need to buy from the grid.

Run your big appliances during the day: Set your dishwasher, washing machine, and clothes dryer to run between 10 am and 3 pm.
Heat your water with the sun: If you have a heat pump hot water system, make sure its heating cycle is timed for the middle of the day. This effectively turns your hot water cylinder into a “thermal battery”.
Pre-heat or pre-cool your home: Use your heat pump to warm your home in winter (or cool it in summer) in the early afternoon, so it’s comfortable when you get home without needing to draw expensive power from the grid in the evening.
Charge your EV: If you have an electric vehicle, charging it during the day is the number one way to use your solar power and save on “fuel” costs.

By making these simple changes, you become an active manager of your home’s energy, ensuring every kilowatt-hour your panels produce is working for you first.

This guide was written by the local team at Solar Generation Tasmania. We’re always happy to help our fellow Tasmanians understand their energy options.

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Published by Solar Generation Tasmania. General information current as at publication — rebates, tariffs and prices change, so confirm current figures before deciding.