For a few years the LGC was a steady, forty-dollar-ish certificate that solar farm financiers could model without losing sleep. By 2026 it is one of the cheapest items in the Australian environmental certificate set. The fall is large enough that it changes how commercial solar is quoted, and it has changed which scheme a mid-sized system should sit in.
This article is a history, with the periods, the rough levels and the drivers. Figures below come from the Clean Energy Regulator’s quarterly carbon market reports and market commentary, and are approximate. They are not a price source. The LGC price on the day you read this will differ, so we give ranges and months, never a current price. For a forecast framework see LGC price forecast 2027, and for the causes see why LGC prices are falling.
The shape of the decade so far
| Period | Approximate spot range | What was going on |
|---|---|---|
| 2019 to 2020 | $30 to $40 | The 2020 interim target was being met, with a wave of projects completing |
| 2021 to 2022 | $35 to $50 | Demand from liable entities and strong buyer interest held the price up |
| 2023 | $40 to $50 | Prices peaked before the slide began in the second half |
| Q4 2024 | about $41.50 falling to $26, finishing near $32 | The slide accelerated as supply outran demand |
| Q1 2025 | about $33 to $22.50 | A drop of roughly a third in one quarter |
| Q3 2025 | about $16.50 to $10.80 | Forward prices for 2028 vintage also reported near $10 |
| Q4 2025 | about $11 to roughly $9 | Single digits arrive |
| 2026 | low single digits earlier in the year, roughly $6 to $9 in September | Oversupply persists |
Sources differ on the exact trough in the first half of 2026. The verified markers we use are about $4 in February and roughly $6 to $9 in September. Either way, the trend is the story: from more than $40 in late 2024 to a single-digit certificate in under two years.
Period one: 2019 to 2023, a market that paid
Through the early part of the period, the LGC was a meaningful revenue line. Developers built projects to meet the 33,000 GWh annual target, and the certificate price covered a useful share of the cost. Prices in the $30 to $50 band made a solar farm’s certificate revenue comparable in size to a good part of its energy revenue.
A worked example shows why that mattered. Take a 100 MW solar farm with a 28 percent capacity factor. It generates 100 x 8,760 x 0.28 = 245,280 MWh a year, so about 245,280 LGCs (before any baseline adjustments).
| LGC price | Annual certificate revenue |
|---|---|
| $45 | $11.04 million |
| $30 | $7.36 million |
| $10 | $2.45 million |
| $8 | $1.96 million |
The same farm earns more than $9 million less a year from certificates at $8 than at $45. That swing is the reason a certificate-backed financing model in 2022 looks fragile in 2026.
Period two: late 2023 to 2025, the slide
Two forces drove the decline. Supply grew faster than the target needed. Large projects kept being built, helped by state contracts and the Capacity Investment Scheme, while the annual target stayed fixed at 33,000 GWh through to 2030. And the target was effectively met, so extra supply had nowhere to go but into surplus.
The result was a falling price from the second half of 2023, and a sharper fall from the fourth quarter of 2024. Market commentary through 2025 repeatedly described supply exceeding demand, with forward prices at about $10 for 2028 vintages by mid-2025.
Period three: 2026, oversupply persists
The Clean Energy Regulator has said the oversupply is expected to persist to 2030, and market sources reported a 2026 surplus in the range of roughly 10 to 15 million certificates, even allowing for growth in voluntary demand. In that world the price is set less by compliance demand and more by voluntary buyers, speculators and the scarce bit of liability not yet covered.
The Renewable Electricity Guarantee of Origin (REGO) scheme, which started on 3 November 2025 alongside the LGC scheme, gives buyers another instrument. It will continue beyond 2030 when the RET ends. Many market participants expect some demand to shift from LGCs to REGOs over time.
What this means for commercial solar
The history also explains why a policy change in 2026 matters. Under the RET, solar systems above 100 kW were power stations that earned LGCs. At $8 an LGC, that was a small revenue stream for a mid-sized rooftop. From 1 October 2026, systems above 100 kW and up to 1 MW installed from that date can create STCs with a fixed five-year deeming period (the Renewable Energy (Electricity) Regulations were amended in 2026; the CER says applications open mid to late November 2026). Systems above 1 MW remain LGC systems. The pillar page mid-scale solar STCs has the detail.
Take a 500 kW system in a zone 3 postcode. Annual generation is roughly 700 MWh at 1,400 kWh per kW. Over the remaining life of the LGC scheme (to 2030), at $8 that is about $5,600 a year. The STC route creates 500 x 1.382 x 5 = 3,455 STCs, worth about $134,700 at $39, paid up front. That difference is the reason the policy change matters, and why a 2023 payback model for a 500 kW system needs to be redone.
From the desk: when you build a commercial quote, do not copy last year’s LGC assumption. A model that assumed $30 a certificate is wrong by about 75 percent. State the assumption on the quote, give a range, and tell the customer the date you checked.
Reading the history without over-reading it
- Past is not forecast. The decline does not mean a rebound is impossible. It means the near-term drivers point down.
- Averages hide swings. The price dropped by about a third in a single quarter in early 2025, so averages understate the experience of anyone who sold in the wrong week.
- Vintage matters. Forward prices for later vintages have been quoted lower than spot, reflecting the 2030 end.
- Source differences. Brokers, the CER and exchanges publish slightly different numbers. Use a consistent source for a model.
Where to track it
The Clean Energy Regulator’s quarterly carbon market reports are the standard public source. Brokers publish spot and forward indications. For a conceptual comparison with STCs, read LGC versus STC and the LGC glossary entry.
Reading the history with a certificate stack in mind
A last point on method. Most LGC price charts show spot, but spot is not the whole story for a generator. A power purchase agreement may bundle certificates at a fixed price, a developer may have sold forward vintages at a different level, and a retailer may have bought at yesterday’s price. Two businesses holding the same asset can report very different certificate outcomes in the same year. When you read a case study or a financial report, check which price it is using. If you want a refresher on the vocabulary, our answers on LGC prices today and what a large-scale generation certificate is are written for non-specialists.
What to do next
- Rebuild any commercial quote that used a pre-2025 LGC price.
- Check whether a system between 100 kW and 1 MW installed from 1 October 2026 fits the STC route.
- Read the LGC pillar at /lgcs/ and our guide to selling commercial solar with LGCs.
- For small systems, see what an STC is worth and the pricing page.