Experts say the collapse of solar tariffs is giving suppliers a great deal.

Some households are still getting generous payments on premium feed-in tariffs originally set up to kickstart the solar industry.

With over 1.6 million houses now featuring solar panels on their roofs, the feed-in tariffs are being phased out.

State governments have set a minimum feed-in price in Tasmania and regional Queensland, while Victoria is moving up its minimum to about 11 cents.

But the rest of the country relies on market forces.

“In the places where there isn't a regulated minimum then there's a lot of evidence that retailers are really getting quite a good deal by paying customers either nothing or four or five cents and avoiding having to buy on the wholesale market for seven, eight, nine cents,” Jack Gilding, executive officer at Tasmania Renewable Energy Alliance, told the ABC.

As solar flows into the grid, retailers save money because they do not have to source that power from the wholesale markets, which see massive price spikes at peak times.

“You can get prices up to $14,000 per megawatt hour, which is $14 per unit at the household level and the solar feed-in rate is five cents,” said Bruce Mountain, energy economist at CME.

Energy can then be sold to customers at retail prices of about 20 to 30 cents.

The energy industry says the market-dictated price is correct.

“It costs money for a retailer to pull that energy from a solar PV system into the grid and redistribute it to a customer base,” said Sarah McNamara, the general manager of corporate affairs at the Australian Energy Council.

“That is not a costless exercise, and the cost of the wholesale energy on the spot market, or on the long-term contract market, has different variables at play than solar PV does.

“We support market-based tariff schemes for that energy that might be fed back into the grid because we believe the market is best placed to set the rate at which that energy is valued,” Ms McNamara said. 

Consumer advocates say the market is complex, with more than 50 retailers offering over 8,000 different contracts.

“Many retailers are offering nothing or next to nothing and it's very difficult for households to discern if they're getting a good deal because it's wrapped up in a purchase contract,” Mr Mountain says.

“You need to split apart the purchase contract and the sales contract to figure out if you're getting the best offer overall.”

Another problem is that not even the market operator actually knows how much rooftop solar is going into the national network.

It says that as “behind-the-meter” power generation like solar increases, “there is a real risk the power system will increasingly operate inefficiently, with assets under-utilised, less informed investment decisions being made and increased costs being borne by customers”.

But even a conservative guess shows household solar is a bargain for retailers.

While solar households receive up to seven cents per unit for power, it costs up to 10 cents to buy wholesale.

In that scenario, retailers would be making up to $370 million a year thanks to cheap rooftop solar.

Considering wholesale spot markets often see massive price spikes, the real profits would be significantly higher.