The Solar Homes Program was promised by the Andrews government before the 2018 state election as part of its plan to install panels on 650,000 homes over 10 years.

The scheme, operated by the government agency Solar Victoria, subsidises half-price solar panels and takes $1000 off the cost of solar hot water in homes.

To date, almost 150,000 households have received a rebate as part of the scheme.

But a review by the Victorian Auditor-General's Office, tabled in parliament on Thursday, found Solar Victoria has been unable to measure the success of the program.

"Solar Vic is not yet able to report to what extent it has reduced consumers' power bills and carbon emissions through this $1.3 billion investment," the report read.

"This is because, despite the program starting in August 2018, Solar Vic only finalised its evaluation methodologies in April 2021."

The auditor-general also found only three months of planning went into the program, while neither the Department of Premier and Cabinet nor the Department of Environment, Land, Water and Planning (DELWP) developed a full business case before it began.

"This meant that government lacked sound and comprehensive information to consider the merits of the program," the report said.

Program planning was also "deficient" as it failed to take into account risks of excess demand, market reliance and grid capacity.

During 2019, the scheme's popularity forced the government to limit the number of subsidies issued each month, leaving installers with no work for weeks at a time.

"Poor demand management led to pauses in rebate rollout, which caused workflow issues for the solar industry," the report said.

"The program also began with limited controls to manage safety and quality risks, fraud and grid limitations."

Solar Victoria's safety audits in August 2020 found about 33 per cent of installations were not "installed to standard", with about 2 per cent considered unsafe.

A review of the safety audits, completed in February by the auditor-general, found substandard installations have increased to almost 37 per cent.

The auditor-general made five recommendations to DELWP, which oversees Solar Victoria, including that it completes a businesses case and cost-benefit analysis on the scheme.

The review said Solar Victoria has made progress in both addressing risks and staging rebate releases and has increased its engagement with the industry.

Energy, Environment and Climate Change Minister Lily D'Ambrosio said many of the auditor-general's recommendations have been implemented.

"The rollout has been absolutely successful. Right now we have 140,000 Victorians who are enjoying the benefits of having a solar panel on the roof, saving significant dollars," she told reporters.

Opposition spokesman for energy and renewables Brad Roswell said the report proved the Andrews government makes "decisions on the run".

"Governments have a responsibility to ensure that taxpayer-funded projects are underpinned by facts-based and results-oriented economic modelling," he said in a statement.

Australian Associated Press