This research develops models and simulations of technical performance, net emission reductions, and discounted market values of thirteen small-scale (<= 6 kW(e)) renewable energy projects. The research uses a simple methodology suitable for small private entities and governments to compare alternative investment options for both climate change mitigation and adaptation in the southwest of Western Australia. The system simulation and modelling results indicate that privately-owned, small-scale, grid-connected renewable energy systems were not competitive options for private entities relative to sourcing electricity from electricity networks, despite subsidies. The total discounted capital and operating costs, combined with the minimal mitigation potentials of the small-scale renewable energy systems resulted in unnecessarily high electricity costs and equivalent carbon prices, relative to grid-connection and large-scale clean energy systems. In contrast, this research suggests that small-scale renewable energy systems are cost-effective for both private entities and governments and exhibit good mitigation potentials when installed in remote locations far from the electricity network, mostly displacing diesel capacity. (C) 2011 Elsevier Ltd. All rights reserved.