Australia’s solar story has gone from a trickle to a flood. Once driven by generous government incentives, rooftop solar is now booming thanks to falling equipment costs. Today, subsidies play a smaller role, and government programs are starting to wind down.
But this rapid uptake hasn’t come without challenges. The surge in solar exports has led to grid voltage issues and even negative wholesale prices. In response, some network providers are beginning to charge households for exporting electricity at certain times.
Household batteries offer an obvious solution to these problems: Helping smooth out solar exports, reducing pressure on the grid, and supporting Australia’s renewable energy transition. For years, many have wondered when the Federal Government will step in to support battery adoption.
With the Federal Government’s Cheaper Home Batteries Program (CHBP), the wait is over. But what exactly is the CHBP, and how does it work?
The Cheaper Home Batteries Program
The CHBP will be available for batteries commissioned from July 1, 2025. The battery discount will be implemented through the existing Small-Scale Renewable Energy Scheme (SRES), the framework that has successfully subsidised household solar panels since 2011. The government will amend the Renewable Energy (Electricity) Regulations 2001 to include battery systems. These regulatory amendments are managed by the Department of Climate Change, Energy, the Environment and Water (DCCEEW), and the Clean Energy Regulator will administer the incentives once the rules are in place.
Funding for the $2.3 billion program comes from the federal budget. The Government will fully fund the discounts by purchasing the newly created small-scale technology certificates (STCs) for batteries itself, rather than imposing costs on energy retailers. This ensures the subsidy is financed through taxpayer funds, avoiding extra costs on consumer electricity bills. This is welcome news, ensuring those who can’t install solar and battery systems aren’t burdened with subsidising others who can.
The CHBP: How it works.
The CHBP incentivises household and business battery storage in the following way:
- Eligible battery systems (5 kWh – 100 kWh) will receive a roughly 30% discount from July 2025.
- This discount equates to $372 per kWh or 9.3 Small-scale technology certificates (STCs) per kWh of usable battery capacity in 2025.
- Discounts will gradually decrease each year, halving by 2030, aligning with expected technology cost reductions.
The program has the following eligibility criteria:
- Battery size must be between 5kWh and 100kWh (usable capacity discounted up to 50kWh).
- Systems must include accredited batteries and inverters listed by the Clean Energy Council (CEC).
- One battery installation per premises; expansions of existing systems are eligible only if previously undiscounted and remain within size limits.
- Both on-grid and off-grid battery installations are eligible.
- On-grid systems must be capable of virtual power plant (VPP) integration (be able to connect to the internet), while off-grid systems have no such requirement.
- Systems must accompany either existing or new solar PV installations.
What happens next?
We’ve had inquiries from customers and shareholders about the program, battery technologies, pricing, future readiness, and recommended installers. Indigo Power isn’t a solar and battery installation company, but as a community-owned electricity provider, we have a good overview of the electricity industry and are in a position to help. We’re intending to bring together a program to help customers access the right technologies, at fair prices, from reputable installers. If you’re interested in participating in an Indigo Power battery program, let us know here, and we’ll keep you updated.
Things to keep in mind when choosing a battery
- Some batteries can only be charged from onsite solar (DC coupled). Others can be charged from any power source (AC coupled), including the grid and solar, once converted to AC power via a solar inverter. We prefer grid-charging capable batteries, as these allow customers to benefit from cheaper daytime electricity prices, like those in our Energy Shapers plan, without relying solely on solar PV for charging. This means you won’t need an oversized solar PV system.
- Consider carefully the size of the solar PV system you need. The average solar PV system is growing, now often over 10 kW in many states. Although upgrading system size may only cost a few thousand dollars extra, bear in mind that some grid operators now charge you to export at certain times. On a sunny day, a 10 kW solar PV system can fully charge a 14 kWh battery before 10 am. Without a large amount of daytime electricity consumption at your home or business, excess solar will either be exported (potentially incurring export charges) or curtailed.
- Timing matters. Think about when you want your battery to charge, and select a battery where this can be easily changed. Our time-of-use feed-in tariffs, which will be in place in the new financial year, will reward customers who export during shoulder periods, early morning and late afternoon. Charging your battery between 10am and 3pm, and not when your solar panels start generating first thing in the morning, ensures you’re exporting at times when your solar has a higher value.
Be future ready
Many battery manufacturers now offer options for bi-directional EV chargers (vehicle-to-grid chargers). If properly incorporated into your existing technology, electric vehicles could significantly expand your home’s battery storage. An 80 kWh EV battery, for instance, dwarfs typical 14 kWh home batteries. We’ve already mentioned the possibility of future export charges and the trend towards very low daytime electricity prices. Consider batteries that provide future flexibility to take advantage of these trends.
It’s an exciting time, and a part of our role across the life of the program is to support our customers to make the most of this opportunity.
Ben is Indigo Power’s Managing Director. He has a passion for collaborative initiatives that positively impact our communities. Ben leads our skilled and committed projects team, driving the uptake of community-scale clean energy technologies in communities around Australia.