Income cap for rooftop solar rebate lowered as scheme clears major new milestone

Victoria is tightening up the eligibility requirements for its rooftop solar and electric heat pump hot water subsidies, as the number of discounted home energy and electrification upgrades delivered through the state’s Solar Homes scheme passes the 500,000 mark.

As of July 1, the combined household income eligibility cap will drop from $210,000 to $150,000 per year for solar and hot water rebates, in a move Solar Victoria says will better target the scheme at households most affected by cost of living pressures.

The value of the rebate – which is available to owner occupiers and rentals – will remain unchanged, offering up to $1,400 of the cost of a solar PV system, and to the equivalent amount in the form of an interest free loan.

For energy efficient hot water systems, the rebate remains at up to $1,400 for a locally made product or up to $1,000 for other products.

Solar Victoria, which oversees the Solar Homes Program for the state Labor government, says the changes are not expected to change the mix of rebate participants all that much, with 80 per cent of existing customers still eligible under the $150,000 cap.

It says that more than half of both the rooftop solar rebates (55%) and hot water rebates (52%) have gone to homes with a combined annual household income of less than $100,000.

Solar Homes has been a major success for Victoria, helping to deliver 353,100 discounted rooftop solar systems and 89,400 energy‑efficient hot water systems since the program was first launched in 2018, as at the end of May this year.

“The more than 353,100 rooftop solar PV systems now installed are contributing over 2.5 gigawatts (GW) of capacity statewide,” Solar Victoria said last month, with households believed to be saving up to $1,000 a year through solar self-consumption.

Hot water upgrades are also gaining momentum, with applications approved for 89,400 energy‑efficient hot water systems, 2,000 of which were locally manufactured. Solar Victoria says an additional 27,000 hot water rebates will be available in the 2026–27 financial year to meet growing demand.

Beyond rooftop PV and energy efficient hot water, Solar Homes has also subsidised the installation of 21,400 home batteries – that part of the scheme was retired in mid-2023 and replaced with interest-free loans. The offer of interest-free loans for batteries was discontinued in mid-2025.

Solar Victoria has also approved rebates for 34,900 reverse cycle air conditioners and 9,900 zero‑emissions vehicles.

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