Do you know what oversizing your solar system means? One salesperson says you can’t put too many panels on your roof. Another says you can double them. A third says it depends on the battery.
It’s confusing. And when you’re making a big investment like this, you want to get it right.
You want your solar system to produce the maximum power possible. You want it to charge your battery quickly, lower your power bill, and give you the best value for your money. Oversizing does this.
At PSC Energy, we have some good news for you. You can oversize your solar system. And in some setups, you can oversize it by a lot in a legal and safe way. But it depends on the type of system you choose.
In this article, you’ll learn about the following:
- What is Oversizing for Solar Panels?
- What Solar Panel Oversizing Rules Actually Say
- DC-Coupled vs. AC-Coupled: What’s the Difference When Oversizing Your Solar Panels?
- Solar Panel Oversizing and the STC Rebate
- When Solar Panel Oversizing Makes Sense (and When It Doesn’t)
By the end of this article, you’ll know exactly what oversizing means, why some systems let you do it more than others, and how to get the best return on your solar setup.
What is Oversizing for Solar Panels?
Oversizing means adding more solar panels than your inverter is built to handle at one time.
To understand this, you first need to know what an inverter is.
Solar panels generate electricity in the form of direct current (DC) power. But your home uses AC power (alternating current). The inverter converts the DC power from your solar panels into AC power so your home can use it.
Most inverters are made to match the size of your solar panel system. But sometimes, you can add more solar panels than the inverter is rated for. This is called oversizing.
For example, you might have a 10-kilowatt inverter. This means it can send 10kW of power into your home at once. However, you might install 13 or even 20 kW worth of solar panels on your roof. That’s oversizing.
Your panels will often make less than their full potential, especially in the morning, late afternoon, or on cloudy days. Oversizing helps you get more out of your system for longer periods of the day when sunlight isn’t as strong.
Some systems only allow for slight oversizing. Others let you oversize a lot. The rules depend on the type of system you have and the kind of battery you use.
If you’re interested in learning more about solar systems, you might want to check out our introductory article titled, New to Solar: Start Here.
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What Solar Panel Oversizing Rules Actually Say
In Australia, the Clean Energy Council (CEC) sets the rules for solar systems that are eligible for government rebates. These rules specify the maximum amount of oversizing allowed for your system.
For a standard solar system without a battery, you are allowed to oversize your solar panels by up to 33% more than the inverter’s capacity. If you have a 10kW inverter, the most you can install is 13kW of solar panels.
However, if you add a DC-coupled battery, the rules change.
A DC-coupled battery is a type of battery that connects directly to your solar panels, bypassing the inverter. This means the battery can charge directly from the panels using DC power.
Due to this setup, you can legally oversize your solar panel system by up to 200% of the inverter’s size. That means that with the same 10kW inverter, you could install up to 20kW of solar panels.
Some batteries, such as Tesla Powerwall, have their own limitations. Although the CEC allows 200% oversizing, Tesla does not permit it on three-phase sites. Instead, they allow only 66% oversizing.
If you have a three-phase home and a Tesla battery, your 10kW inverter can only support up to 16.6 kilowatts of panels.
It’s important to review both the CEC rules and the battery manufacturer’s guidelines before determining how much to oversize. A good solar installer can guide you through it.
If you’re interested in learning a bit more about solar panels and energy systems, you might want to check out the following article titled, Are Solar Panels Worth It in NSW, Australia? A Price Breakdown for 2025.
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DC-Coupled vs. AC-Coupled: What’s the Difference When Oversizing Your Solar Panels?
To understand oversizing, you need to know the difference between DC-coupled and AC-coupled solar systems. These terms explain how your solar panels, battery, and inverter work together to produce energy.
In a DC-coupled system, the solar panels send power directly to the battery, bypassing the inverter. The battery charges using the same kind of power the panels make, DC power.
Then, when the battery or panels send power into your home, the inverter changes it to AC power. This setup is more efficient for charging the battery, and it allows you to oversize your panels significantly.
In an AC-coupled system, the panels send power through the inverter first, then into the battery. This means the power must switch from DC to AC to charge the battery, and that’s less efficient. You lose some power in the process.
That’s why AC-coupled systems can only be oversized by 33%. They depend on the inverter for everything. However, DC-coupled systems can increase by up to 200% because the battery charges directly from the panels rather than through the inverter.
DC-coupled batteries can also be installed in an AC-coupled system. However, your internal inverter will not be used, so it’s paying for equipment you won’t use.
If you’re interested in learning about types of solar batteries, you might want to check out the following article titled, AC-coupled Battery vs. DC-coupled Solar Batteries.
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Solar Panel Oversizing and the STC Rebate
In Australia, when you install a solar system, you are eligible to receive a rebate through the STC scheme. STC stands for Small-scale Technology Certificate. This is part of a government scheme that gives you a discount when you install solar panels. The more solar you install, the more STCs you get, and the bigger your rebate.
The rebate is based on the number of panels you install, not the size of your inverter. This is why oversizing can be such a smart move.
Let’s say you install a 10kW inverter with 13kW of solar panels. That’s the most you can oversize if you have a regular AC system due to the 33% rule. You will get STCs for 13kW worth of panels, not just the 10kW your inverter is rated for.
Now, let’s say you install a DC-coupled system. You still have a 10kW inverter, but now you install 20kW of solar panels. If your battery is properly set up, you can legally do this. You can also obtain STCs for 20kW of panels.
That’s a big difference.
- You get more money back because you’re claiming more panels.
- You also get more solar energy every day.
- And your battery can charge faster because it gets more power from more panels on the roof.
Because of the STC rebate, adding more panels will cost you less per panel. The extra rebate helps cover part of the cost of installation, wiring, and racking. You get more value without spending a lot more.
At PSC Energy, we offer two DC-coupled solar batteries. They are Sigenergy’s SigenStor system and the Tesla Powerwall 3 system.
If you’re interested in learning about the rebate for solar, you might want to check out the following article titled, Understanding the Federal Government Solar Rebate in Australia: The STC Scheme in 2024
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When Solar Panel Oversizing Makes Sense (and When It Doesn’t)
Oversizing depends on your home, your energy use, and the kind of system you choose.
Oversizing makes sense when:
- You have a DC-coupled battery system. These systems can draw more power from the panels without requiring a larger inverter. The extra power goes straight to the battery. You don’t waste it, and you can use more solar every day.
- Your roof gets shade during part of the day. When your panels don’t receive full sunlight all day, oversizing can help make sure you still produce enough energy.
- You want to charge your battery faster. More panels means more power. Your battery can be fully charged earlier in the day and still have extra solar energy left to run your home or send to the grid.
- You want to take full advantage of the STC rebate. The more panels you install, the more solar tax credits (STCs) you can claim. This can lower the cost of your system.
- You live in a single-phase home. These homes have limits on the size of the inverter. Oversizing the panels helps you generate more solar energy without exceeding those limits.
Oversizing might not make sense when:
- You have an AC-coupled battery system, and you already hit the 33% oversizing limit. You won’t be able to use more solar than that. If you attempt to exceed the limit, you may not receive rebates, or your system may not function properly.
- Your battery or system brand has stricter rules. Some brands, like Tesla, limit oversizing to 66% on three-phase systems. If you go past that, they may not support the system, and you could lose your warranty.
- You don’t have enough roof space. Oversizing needs space for more panels. If your roof can’t fit them, it might not be an option. However, there are other options, like a ground-mounted system.
Every home is different. The best plan is to consider your energy use, roof, budget, and long-term goals.
If you’re interested in learning a bit more about your energy needs, you might want to check out the following article titled, How Much Solar Do You Need?
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With Oversizing, Getting There is Half the Sun
Oversizing your solar system is one of the most effective ways to maximise the value of your setup. It helps you generate more power, charge your battery faster, and qualify for a larger rebate. But it only works well when you choose the right kind of system.
If you use a DC-coupled battery, you can legally oversize by up to 200% of your inverter size. This provides the most flexibility and optimal use of your panels. If you use an AC-coupled system, your limit is usually 33% unless your battery brand, such as Tesla, sets a lower limit, like 66% for three-phase homes.
At PSC Energy, we follow the rules, check your battery specs, and design these systems the right way. When done correctly, oversizing can yield better results for less money. We help you get more energy, a bigger rebate, and a system that works better over time. It’s what we do.
If you’re interested in learning a bit more about the federal solar rebate, also known as the Federal Cheaper Home Batteries Program, you might want to check out the following article titled, What the 2025 Federal Election and the Government Rebate Means for Solar Batteries in Australia.
