Can You Sell Your Extra Solar Power to the Grid — And Is It Worth It?

You’ve got solar panels on your roof and, on sunny days, they produce more power than your home can use. In most cases, that extra electricity is sent to the grid — and your energy retailer pays you a credit for it, called a feed-in tariff (FiT).

Sounds simple enough, However, there’s more to it than just “sell your power, get paid.” Your ability to export is shaped by network rules, meter settings, and even the cables running down your street. If you’re on a single-phase connection, you’ll often be limited to exporting a maximum of 5kW at any one time. Three-phase homes can sometimes export more — up to 5kW or even 10kW per phase — but this depends on your local network operator. In some areas with voltage rise issues, households have been set to zero export, meaning they’re not allowed to send anything back at all.

On top of that, FiT rates vary wildly between states and retailers, and new two-way pricing tariffs — like those from Ausgrid and Essential Energy — are changing how retailers value your exports throughout the day. Add in a few misleading headlines about “sun taxes” and it’s no wonder many people are unsure if exporting solar is even worth it anymore.

We’ve spent years helping Australian homeowners make sense of solar exports — from understanding feed-in tariffs and export limits to weighing up whether a battery or Virtual Power Plant (VPP) offers better value. 

In this article, you’ll learn exactly how selling your extra solar power works in 2025, what you can realistically earn, and how to decide whether exporting, storing, or shifting your usage is the smartest move for your home.

What Is a Feed-in Tariff (FiT)?

A feed-in tariff (FiT) is the rate your energy retailer pays you for each kilowatt-hour (kWh) of electricity your solar system exports to the grid. It’s shown on your electricity bill as a credit, which is deducted from the amount you owe for the power you’ve imported from the grid.

Who sets the rate?

• In most states, the government sets a benchmark or minimum rate, but your actual FiT is decided by your retailer. (eg AGL, Origin, Redenergy, Alinta Energy etc)
  
• Some retailers offer higher rates to attract solar customers, while others stick close to the minimum.
  

Fixed vs time-varying FiTs

• Fixed FiT: The same rate is paid for every kWh you export, no matter the time of day.
  
• Time-varying FiT: Rates change depending on when you export. You might get a higher rate in the late afternoon or early evening when demand is high, and a lower rate during the middle of the day when the grid is flooded with solar.

Why FiTs are lower than the price you pay for power

You might pay 30–50c/kWh to buy electricity from the grid but only get 3–10c/kWh for what you export. That’s because FiTs are based on the wholesale value of electricity at the time of export — which is often low during sunny midday hours when solar supply is abundant.

2025 Feed-in Tariff Rates by State

Here’s how much solar households can expect to earn per kilowatt-hour (kWh) exported to the grid in 2025—but remember, actual rates vary depending on your state, postcode, and retailer.

State / Territory	Approx. FiT Range (2025)	Notes
NSW	4.8–7.3¢/kWh	IPART benchmarks for all-day flat rates. Retailers typically offer between 4–10c/kWh, depending on tiered daily thresholds.
Victoria	0.04¢/kWh	ESC has droped the minimum FiT from 3.3c to just 0.04c as of 1 July 2025.
Queensland	5–10¢/kWh	No mandatory minimum. Some retailers are offering up to 12¢/kWh bonus rates; legacy high FiTs (up to 44c) remain for early adopters.
South Australia	5–12¢/kWh	Retailers set their own rates. Top offers are around 10–12c for limited daily export caps.
WA	10¢ (evening), 2.5¢ (off-peak)	Time-of-use FiTs from Synergy, with significantly higher rates during 3–9 pm.
Other states/territories (ACT, TAS, NT)	Varies—typically 5–10¢/kWh	Retailer-determined, with some legacy high-rate schemes still active.

What about two-way tariffs — a.k.a. the so-called “Sun Tax”?

From July 2025, Ausgrid  and Endeavour Energy’s network in NSW introduced a new two-way pricing tariff. Some media outlets have labelled this a “Sun Tax”, however that description is misleading. It’s not a Government tax on households. Instead, it’s a pricing mechanism applied to electricity retailers, aimed at managing the grid more fairly and efficiently as solar uptake continues to grow.

Why it was introduced

Efficient use of the network — Grids were originally built for one-way power flow (from power stations to homes). With more rooftop solar than ever, the grid now has to handle energy flowing both ways. Two-way pricing encourages exports when the grid needs them, and discourages them when it doesn’t.

Fairer cost sharing — Previously, the costs of managing heavy daytime solar exports were spread across all electricity users — including those without solar. Two-way pricing allocates these costs more fairly to retailers, who may then adjust their solar plans.

Grid stability — Midday solar oversupply can overwhelm the network. By applying small charges for excess exports during those hours and offering rewards in the late afternoon/evening, Ausgrid reduces strain and helps avoid costly infrastructure upgrades.

Future readiness — With solar numbers still growing, two-way tariffs are designed to prepare the grid for even higher levels of rooftop solar in years to come.

How it works

Retailers are charged, not households directly. Ausgrid applies network export charges to retailers during the midday solar ‘glut’ and offers credits for evening exports.

Ausgrid charging/export model:

• Charge: 1.2 c/kWh for exports between 10 am–3 pm.
  
• Reward: 2.3 c/kWh for evening exports (4–9 pm).
  
• Includes a “free threshold” — a small export cap you can send without being charged.
  

Essential Energy in regional NSW has introduced its own two-way pricing as of 1 July 2025, allowing for both charges and rebates depending on timing and export volume.

• Retailers decide how to pass this on. Some may slightly reduce FiTs; others might adjust daily supply or usage charges instead.
  
• Free threshold. Most households can export a set daily amount without any impact. Only exports above this threshold, at low-value midday times, are affected.
  
• Incentives for useful exports. Exports between roughly 4–9 pm may attract higher credits if your retailer passes these on.
  
• For most households, the financial effect of two-way tariffs is modest—but they do highlight another reason why using solar energy yourself (rather than exporting it) can be more cost-effective.

What it means for you

• In the short term, many customers won’t notice a big change, especially if their retailer keeps FiTs flat.
  
• Over time, expect retailers to shift their solar plans: lower credits at midday, higher credits in the evening.
  
• West-facing solar panels or a battery that can discharge during peak times are well placed to take advantage of these changes.
  

Why it matters

Two-way pricing reflects a broader shift in solar economics. The focus is moving from earning money through daytime exports to maximising self-consumption and evening exports. By using more of your own solar during the day, or storing it in a battery, you’ll save more on your bill and help keep the grid stable for everyone.

Can You Make a Profit from Selling Solar Power to the Grid?

For most Australian households, selling excess solar power to the grid is more about reducing your electricity bill than making a meaningful profit. The maths comes down to two key points:

1. You buy electricity for much more than you sell it
   
   • Typical purchase price from the grid: 30–50¢/kWh
     
   • Typical feed-in tariff in 2025: 3–10¢/kWh

That means every kWh you use yourself instead of exporting saves you up to five times more than selling it.

2. Export caps limit your earnings
   
   • In standard suburban single-phase homes, you can export up to 5 kW at any time.
     
   • Three-phase homes may be able to export more, but only if their network allows it.
     
   • In rural areas, stricter limits (or even zero-export rules) can further restrict your earning potential.
     

A real-world example

Let’s compare a household using 24 kWh/day versus exporting 24 kWh/day at different rates:

Scenario	Rate	Daily value	Quarterly value (90 days)
Buying from grid (best case)	30¢	$7.20	$648
Buying from grid (worst case)	50¢	$12.00	$1,080
Selling to grid (high FiT)	7¢	$1.68	$151.20
Selling to grid (low FiT)	3¢	$0.72	$64.80

Even at the higher end of FiTs, the credit you earn from exporting is modest compared to the savings you get from using that energy yourself.

When exporting can be more valuable

• High time-of-use FiTs: If your retailer pays extra for late-afternoon or evening exports, you can time appliances to free up more solar for those windows.
  
• Virtual Power Plants (VPPs): Some VPP programs pay higher rates or offer bonuses for allowing them to control your battery’s exports during peak demand.
  
• Legacy premium FiTs: Legacy tariffs (30-45c/kWh) apply to pre-2011 installations. Rates have decreased as of July 1, 2025, for standard contracts.

Selling to the Grid vs Storing in a Battery

When your solar panels produce more energy than you need, you have two main options:

1. Export it to the grid and receive a feed-in tariff (FiT).
   
2. Store it in a battery to use later, reducing the amount you buy from the grid.
   

The financial difference

• Exporting to the grid: Typical FiT in 2025 is 3–10¢/kWh.
  
• Using stored energy instead of buying from the grid: Saves you 30–50¢/kWh (your retail electricity price).
  

That means each kWh you store and use later is usually worth three to five times more than what you’d get selling it back to the grid.

Example:
If you export 5 kWh/day at 7¢/kWh, you earn 35¢/day. If you store that same 5 kWh and avoid buying at 35¢/kWh, you save $1.75/day. Over a year, that’s $127.75 from exporting versus $638.75 from storing.

Now this is a small amount of export… Some houses are exporting 20+ KWH into the grid / day 

See below example 

When exporting might still be attractive

• High time-of-use FiTs: Some retailers offer higher rates during peak grid demand. This could beneficial if you have a West Facing array of panels (west facing captures afternoon sun)
  
• If you have a small system: You may not have much excess power to store, making a battery less beneficial.
  

Battery considerations

• Upfront cost: A quality home battery typically costs $8,000–$15,000 installed.
  
• Payback period: Often 7–12 years, depending on your usage patterns, electricity prices, and available rebates.
  
• Flexibility: Batteries can also provide backup during blackouts and participate in Virtual Power Plant (VPP) programs for extra income.

How Virtual Power Plants (VPPs) Change the Equation

A Virtual Power Plant (VPP) links together many home solar and battery systems so they can be managed as one large power source. The VPP operator — often your electricity retailer or a specialist energy company — can control when your battery charges or discharges to help support the grid during high-demand periods.

In return, you receive payments, bill credits, or access to special electricity plans.

How VPPs can improve your returns

• Higher export rates during demand peaks: Instead of the usual 3–10¢/kWh FiT. Amber for example offers up to $16 / KwH to draw energy from your battery
  
• Sign-up bonuses or rebates: As it currently stands, the NSW VPP incentive offers $40-$55 / KwH to sign up. For example, 24kWH battery x $55 kwh = $1,320 as a VPP cashback
  
• Better self-consumption: VPP software can optimise your battery usage so you use more of your own solar power.

Example

If a VPP discharges 5 kWh from your battery during a high-demand event and pays $0.50/kWh, you earn $2.50 for that event. Multiply that by dozens of events per year, and it can add hundreds of dollars to your annual return.

The trade-offs

• Control: You give up some control over your battery. The VPP may discharge it when you’d prefer to keep it full.
  
• Plan lock-in: You often need to stay with the same retailer for the VPP benefits.
  
• Variable earnings: Payments depend on how often the VPP calls on your battery and the market price at the time.

Maximising the Value of Your Solar Exports

If you want to get the most out of every kilowatt-hour your solar system produces, you need to think beyond just the feed-in tariff (FiT) rate. A few smart changes can significantly improve the value you get from your solar investment.

1. Choose the right retailer and plan

• Compare FiT rates — some retailers pay 2–3¢/kWh more than others. Find out more in our recent article
  
• Look for time-varying FiTs if your home can export during high-value periods (late afternoon/evening).
  
• Read the fine print — some “high FiT” offers come with higher daily supply charges or less competitive usage rates.
  

2. Shift your energy use to daylight hours

• Run appliances like dishwashers, washing machines, and pool pumps during the middle of the day when your panels are producing the most.
  
• Use timers or smart plugs to automate this.
  
• Every kWh you use yourself saves you 30–50¢ instead of earning you just 3–10¢.
  

3. Consider battery storage

• Store excess energy to use during peak evening hours instead of exporting it.
  
• Pair the battery with a Virtual Power Plant (VPP) to increase export value when the grid is under strain.
  
• Take advantage of federal or state rebates to shorten the payback period.
  

4. Optimise your system for network rules

• If you live in a rural area with lower export limits, focus on maximising self-consumption since you can’t send as much to the grid.
  
• For homes with west-facing panels, align exports to late-afternoon demand peaks, which can attract higher FiTs.
  

5. Maintain your solar system

• Dirty panels and underperforming inverters can reduce your output — and your export earnings.
  
• Schedule regular inspections and cleanings, especially before summer.

Key Takeaways — Is Selling Your Extra Solar Power Worth It in 2025?

Selling your extra solar power back to the grid is still a useful way to reduce your electricity bill, but it’s rarely a big money-maker in 2025.

The pros:

• Provides bill credits for unused solar power.
  
• Easy to do once your system and smart meter are set up.
  
• Can be combined with time-varying FiTs, or with a battery through VPP participation, for better returns
  

The cons:

• Typical FiTs (3–10¢/kWh) are much lower than the price you pay for grid electricity (30–50¢/kWh).
  
• Export limits and network constraints can reduce how much you can send to the grid.
  
• Two-way pricing tariffs may lower FiT value in the middle of the day.
  

Who benefits most from selling to the grid?

• Homes with no battery storage and consistent excess production. However, only marginally now.
  
• West-facing systems that align with higher-value late-afternoon FiTs.
  
• Battery owners participating in VPPs that pay premium export rates during peak demand.
  

The real financial win with solar is in self-consumption — using your own energy instead of buying from the grid. Selling to the grid is still worth doing for your unused solar, but it should be seen as a bonus, not the main source of value.

If you’re unsure whether exporting, storing, or joining a VPP is right for you, the team at Lenergy can help you assess your home’s usage patterns, network rules, and available rebates. Get in touch today to discuss the smartest way to use your solar so it works harder for your household.