Solar Panels for Business in Australia: The 2026 Guide

If you run a business in Australia, you have probably noticed your electricity bills creeping up. Commercial rates have risen sharply over the past few years, and there is no sign of that reversing. So when someone suggests solar panels for your business, the question is not really "is solar a good idea in theory?" but rather "does it actually make financial sense for my specific situation?"

I spend a lot of time writing about residential solar, and the answer there is usually a clear yes. For businesses, the answer is even more emphatic. The economics of commercial solar are genuinely better than residential in most cases, and the reason is simple: businesses use electricity when the sun is shining.

A household might export 50% or more of their solar generation because nobody is home during the day. A cafe, warehouse, or office is running lights, air conditioning, fridges, and equipment right through the middle of the day. That higher self-consumption rate is the single biggest factor in commercial solar economics, and it changes the payback equation dramatically.

There are a few reasons the numbers work out better for businesses, and they are worth understanding before you start comparing quotes.

First, self-consumption. Every kilowatt-hour your business uses directly from its own panels saves you the full retail rate, which is typically 30 to 45 cents per kWh for commercial customers. Exported energy only earns you a feed-in tariff of 3 to 10 cents. A typical business with daytime operations will self-consume 60 to 80% of its solar generation. Compare that to around 30 to 50% for a household where everyone is at work during peak solar hours.

Second, scale. Commercial systems are larger, and the cost per watt drops as system size increases. A 6.6kW residential system might cost $1.00 to $1.30 per watt installed, while a 30kW commercial system could come in at $0.80 to $1.10 per watt. You get more bang for your dollar at scale.

Third, the tax benefits. Businesses can claim the cost of a solar system as a tax deduction, which households cannot. Under the instant asset write-off, eligible businesses can deduct the full purchase price in the year of installation. We cover this in detail in our instant asset write-off guide, but the short version is that a business on a 25% tax rate effectively gets a 25% discount on the system after the deduction. That alone can shave a year or more off the payback.

Getting the size right matters. Too small and you leave savings on the table. Too large and you are exporting cheap power instead of using it. The goal is to match the system to your daytime electricity consumption as closely as possible.

As a rough guide, here is what different business types typically need:

These are ballpark figures. The actual cost depends on your location, roof condition, the components you choose, and how competitive your local installer market is. The important thing is to base the sizing on your real electricity data, not guesswork. Pull out your last 12 months of bills and look at your average daily consumption. A good commercial installer will do a load profile analysis to work out exactly how much solar you can productively use. For a deeper look at commercial system options, see our guide to commercial solar systems.

Let me walk through a realistic example. Say you run a small manufacturing business with a daily electricity consumption of about 80 kWh, mostly during business hours. Your commercial rate is 38 cents per kWh. You install a 30kW system for $28,000 after the STC rebate.

In a decent solar region like Sydney or Brisbane, a 30kW system generates around 120 kWh per day on average across the year. With 70% self-consumption, you are using about 84 kWh directly and exporting the rest. That self-consumed power saves you roughly $31.90 per day (84 kWh x $0.38). The exported 36 kWh earns maybe $2.50 at a 7c feed-in tariff. Total daily value: about $34.40, or roughly $12,500 per year.

Now factor in the tax benefit. If your business claims the full $28,000 as an instant asset write-off and pays a 25% tax rate, that is $7,000 back at tax time. So your effective outlay is $21,000. Divide that by $12,500 in annual savings and you are looking at a payback of under two years. Even without the tax deduction, the payback is about 2.2 years.

After payback, you are essentially getting free electricity for the next 20+ years (panels are warranted for 25 years and often last longer). Over the system's lifetime, that is $250,000 or more in avoided electricity costs. The return on investment dwarfs just about any other capital expenditure a small business can make.

Of course, not every business will see numbers this good. A business that operates mainly on weekends or evenings will have lower self-consumption. A business in Hobart will generate less than one in Brisbane. But even in less ideal scenarios, commercial solar payback periods of 3 to 5 years are the norm, not the exception.

For a detailed breakdown of what commercial systems cost by size, including hidden costs to watch for, see our commercial solar cost guide.

This is arguably the biggest difference between residential and commercial solar. Homeowners pay for solar with after-tax dollars and that is the end of it. Businesses, on the other hand, can claim the cost as a tax deduction.

The instant asset write-off allows eligible businesses to deduct the full cost of the solar system (after any STC rebate) in the financial year it is installed and first used. For a business on the 25% company tax rate, a $30,000 system effectively costs $22,500 after the deduction. Sole traders and partnerships on higher marginal rates can see an even larger tax saving.

There are eligibility criteria and thresholds to be aware of, and the rules do change from year to year. We cover the details, including current thresholds and how to structure the claim, in our instant asset write-off for solar guide. It is worth reading before you talk to your accountant, so you know the right questions to ask.

If your system is too expensive for the instant write-off, you can still claim it through ATO depreciation. The simplified depreciation pool for small businesses depreciates at 15% in year one and 30% each year after, which is significantly faster than the standard 5% prime cost rate.

The federal STC (Small-scale Technology Certificate) rebate applies to commercial systems up to 100kW, just as it does for residential. The rebate amount depends on system size and your location, but for a 30kW system in Sydney, you are looking at roughly $7,500 to $9,500 off the upfront cost. This is usually applied as a point-of-sale discount, so you never actually pay the full sticker price.

The STC rebate decreases each year as part of its scheduled phase-down, and it ends entirely in 2030. If you are considering solar for your business, the rebate you can claim today is the largest it will ever be. We explain how the phase-down works in our STC rebate ending guide.

On top of the federal scheme, some states and territories offer additional incentives for commercial solar. These vary significantly and change often. Our commercial solar rebates page keeps track of what is currently available in each state.

Commercial solar is not something you want to rush into, but it is also not as complicated as some installers make it sound. Here is a practical approach.

Start by gathering your last 12 months of electricity bills. You want to know your average daily consumption, your peak demand, and your current rate. This gives any installer the data they need to design a system properly. If you have interval data from a smart meter, even better.

Get at least three quotes from accredited commercial solar installers. Commercial installations are more complex than residential, so you want installers with specific experience in commercial work. Check their accreditation, ask for references from similar-sized businesses, and look at their track record. Our guide to vetting solar installers walks through the key things to check. If you are an installer looking for commercial leads, see our solar leads program.

When comparing quotes, look beyond the headline price. You want to understand the estimated annual generation (in kWh), the assumed self-consumption rate, the projected annual savings, the warranty terms for panels and inverter, and whether the quote includes everything: scaffolding, switchboard upgrades, metering changes, and council approvals if required. A cheap quote that excludes half the necessary work is not actually cheap.

Also pay attention to the panel and inverter brands. For commercial installations, reliability matters even more than residential because downtime directly affects your savings. Stick with Tier 1 panels and reputable inverter brands with strong Australian support. Your installer should be able to explain why they have chosen specific components and what the warranty claim process looks like if something goes wrong.

I would be doing you a disservice if I did not mention the situations where solar is harder to justify for a business. If your business operates primarily at night (say, a nightclub or overnight logistics hub), your self-consumption will be low and the payback will stretch out significantly. A battery could help, but the added cost changes the equation.

If you are leasing your premises and the lease expires in a few years, the maths gets tricky. Some landlords will co-invest or offer longer lease terms in exchange for the asset, but you need to negotiate that carefully. If you are on a short lease with no extension option, it is hard to recoup the investment.

And if your roof is in poor condition or needs replacing within the next five years, sort the roof out first. Installing solar on a roof that will need work soon means paying for removal and reinstallation down the track.

For farming operations, many of these issues do not apply. Farms typically have massive shed roofs, high daytime loads, and long-term ownership. Our farm solar guide covers the specific economics.