Household solar could power all of Sydney

There is enough capacity in solar power systems on Australia's homes and businesses to provide electricity for 1.8 million homes.

Solar power systems on Australia's homes and businesses could provide electricity for 1.8m homes. (AAP)

Australian households and businesses are now generating enough electricity from solar panels on their roofs they could power every home in Sydney.

There are almost 2.8 million small-scale solar systems in Australia with a collective capacity of 6000 megawatts - an amount the Clean Energy Regulator calls a remarkable milestone.

And it's set to continue.

"More households, schools, community groups and businesses are looking to install solar panel systems," executive general manager Mark Williamson said on Thursday.

"More than one in five Australian households now have solar panels installed on their roof, and that's the highest rate per capita in the world."

As well, there's a trend of people installing larger systems as prices drop and families can more easily afford a bigger set of panels.

The regulator's figures come as the Climate Council releases its report card on renewable energy across the country.

It finds South Australia, Tasmania and the ACT are leading the "renewables race" in terms of the penetration and targets set for renewable energy.

The council predicts NSW and Queensland will soon see a significant increase in the amount of renewable energy with the most new wind and solar plants being built in those states.

It also notes that states are heeding messages about the importance of storage backup for renewable energy.