Federal budgets tend to be judged by the headline numbers. On renewable energy, this budget is not a major new spending package so much as a continuation of existing programs, with some important work starting behind the scenes.
For households, the most immediate items are the continuation of the Cheaper Home Batteries Program and changes to electric vehicle novated leasing arrangements. These are the measures people are most likely to notice directly. But the more important long-term story may be less visible: new funding to help rooftop solar, home batteries, electric vehicle chargers, and smart appliances work together properly as part of the electricity system.
There is some funding for large-scale energy, project approvals, industry policy and gas. But for this blog, we’re more interested in what this budget means for the technology in and around the home: solar, batteries, electric vehicles, chargers and flexible electricity use.
The renewable energy budget in brief
A fair reading of the budget is that it does not deliver a major new round of direct funding for renewable energy projects. There is nothing Indigo Power can draw on in the same way we did with the Community Batteries program.
At the larger scale, the Capacity Investment Scheme continues. This is essentially a federal underwriting scheme that runs competitive tenders for renewable generation and provides successful projects with a long-term revenue safety net. In practice, if a project’s market revenue falls below an agreed floor, the government pays part of the shortfall. If revenue rises above an agreed ceiling, the project shares some upside with the government.
This is important to drive new large-scale investment because the revenue profile for renewable energy generation is getting tougher. When one solar farm is generating, many others (and all our rooftop solar systems) usually are too, pushing prices down. Government underwriting helps reduce that investor risk while still leaving projects exposed to market signals.
The budget also funds environmental approval reforms, including bilateral agreements and bioregional planning, aimed at speeding up project approvals.
For households, the big program that keeps running is the Cheaper Home Batteries Program (CHBP). Many people will have heard how successful this program has been, so it is good to see it continuing.
There have also been changes to EV incentives and support for charging infrastructure. The budget keeps the existing 100% FBT discount for eligible electric cars valued up to $75,000 that are provided before 1 April 2029. From 1 April 2029, eligible electric cars up to the fuel-efficient luxury car tax threshold move to a permanent 25% FBT discount. Cars above $75,000 but below the fuel-efficient luxury car tax threshold get a 25% discount if provided between 1 April 2027 and 1 April 2029.
Both the CHBP and the EV incentives have been popular. In our family, we installed a battery under the Cheaper Home Batteries Program and currently have a novated lease for the Kia EV9 we bought in 2024. Driving the family around in the EV9, you definitely hope there will be ongoing funding for the EV charging network. It can still be a challenge. If we are travelling during busy holiday periods, we tend to leave at 5am just to make sure we can get to a charger before the queues build up.
The National EV Fast-Charging Network is the highway charging program, funding 117 fast-charging sites with the aim of having chargers roughly every 150 kilometres on national highways. The newer Accelerating EV Charging funding is aimed at expanding kerbside and fast charging in suburbs and regions, and removing rollout bottlenecks such as poor site selection and slow network connections.
So the budget change is not a new headline EV subsidy. It mainly extends and broadens support so the industry has more time and scope to put the charging and servicing backbone in place.
The less visible reform
There is another issue that the budget addresses, which is sitting underneath all of our household technologies.
Many of you who installed batteries through the Cheaper Home Batteries Program probably have not enrolled them in a virtual power plant (VPP). If so, you would be like almost everyone else. AEMO’s Integrated System Plan continues to downgrade its VPP expectations with each new release.
There is a major trust issue, but it is also genuinely complicated. That is why one of the budget’s sleepers may be the $143.2 million over five years to “maximise consumer and community benefits of the energy transition”. A part of those funds is to continue the National Consumer Energy Resources Roadmap and to establish a National Technical Regulator (NTR). The NTR job is to help create a national technical framework so rooftop solar, batteries and other customer-owned energy technology can be integrated and coordinated properly.
It sounds bureaucratic, but if done well, it could be important.
The problem: the technology is arriving faster than the rulebook
The energy transition is no longer just about large wind and solar farms. It is now happening in homes, businesses, car parks, community facilities and local distribution networks.
Rooftop solar, batteries, EV chargers, smart hot water systems and other flexible loads are all part of what governments call consumer energy resources, or CER. In plain English: customer-owned energy technology.
The challenge is not whether this technology is useful. It clearly is. The challenge is whether it can be connected, registered, seen, switched, coordinated and rewarded in a way that works for customers, retailers, networks and the broader electricity system.
That is the real question: how do we close the gap between the promise of consumer energy resources and what they are currently delivering?
ARENA has been funding a program called Smart Connect, which brings together AEMO, Energy Networks Australia, the Australian Energy Council, the Clean Energy Council and others to explore this question. A recently published Smart Connect workpaper sets out the scale of the issue clearly.
CER deployment is accelerating rapidly, with more than 4 million solar installations, around 200,000 batteries installed in the previous six months, and weekly installation rates estimated at around 6,000 solar systems, 9,000 batteries and 1,500 EV chargers. But market participation remains low, with less than 1% of CER responding to market signals.
In other words, the hardware is arriving, but the full contribution is not. We are installing the equipment quickly, but we have not yet built all the systems needed to make it useful at scale. There are a few practical problems.
First, every network, retailer, installer, technology provider and manufacturer needs to know what standards apply. Without common standards, each market or jurisdiction can start to look different. That increases cost for manufacturers, complexity for installers, and confusion for customers. We see this in our community battery work. Some batteries and controllers talk different languages, and that can create real problems for effective operation.
Second, devices need to be registered properly. If a household installs a battery or EV charger, the system needs to know what it is, where it is, what it can do, and who is allowed to interact with it.
Third, customers need to be able to switch providers. If your battery only works with one service provider, you are not getting real competition. The better future is one where customers can move to the best retail offer, virtual power plant or flexibility service without having to replace equipment or start again.
Fourth, retailers and service providers need access to the right data, with customer consent and strong security. If a retailer cannot see basic standing data about a battery or dynamic operating envelope information, it is much harder to offer smart tariffs or energy services that reward flexibility.
That is true for us. We often have to infer what has been installed from meter data. That means we cannot shape our pricing for the year ahead as well as we could if, for example, we knew that 25% of our customers had installed batteries over the past year.
Finally, the system needs to avoid blunt emergency controls wherever possible. Emergency backstops may be necessary as a safety net, but the better outcome is coordinated, responsive CER that helps the system before emergency controls are needed. We do not want the default model to be a network operator turning down solar exports or switching inverters off.
Smart Connect describes the risk of fragmentation in very practical terms: 15 distribution networks, more than 30 retailers, hundreds of technology manufacturers and thousands of installers. Without coordination, that means duplicated systems, inconsistent processes, higher costs, customer confusion and reduced access to value.
That is why this needs funding.
No single retailer, network, technology company or installer can solve this on their own. It needs national standards, common registration, consistent data access, technical certification and coordination between governments, regulators and industry.
What the new regulator is trying to achieve
The National Consumer Energy Resources Roadmap is trying to make the small-scale energy system easier, safer and more valuable for customers.
The aim is to help Australians get more value from rooftop solar, batteries, EV chargers and other smart technology, while keeping the grid secure and reliable.
For customers, the future should look something like this:
- Consistent standards: batteries, inverters, EV chargers and other devices meet common national requirements, rather than a patchwork of different rules.
- Easier connection and registration: customers and installers face less duplicated paperwork and fewer inconsistent processes.
- Better data sharing: authorised parties can access the information they need to provide tariffs, VPPs and other services, with appropriate consent and protections.
- More flexible offers: retailers and aggregators can reward customers for charging, discharging or shifting load at useful times.
- More customer choice: customers can switch between service providers more easily and access the best available offer.
- Stronger protections: as more devices become connected and controllable, cybersecurity, consent and consumer protections become more important.
- Lower system costs: better coordination can reduce peak demand, avoid some network costs, and put downward pressure on costs for all consumers, including those without solar or batteries.
This is not just about households with batteries making a bit more money from a virtual power plant. Done well, CER coordination should reduce costs across the system.
The government’s CER Roadmap material says better coordination can reduce pressure on all bills by lowering the need for some network upgrades, reducing peak demand and improving system efficiency.
A poorly coordinated CER rollout risks creating a two-tier system: households with the right technology and the right digital access get the benefits, while everyone else carries more of the cost. A well-coordinated system should do the opposite; it should help flexible customer technology lower costs for everyone.
Getting this boring plumbing of the energy transition right is not going to change everything overnight, but it is important in the longer term.
For Indigo Power, this budget initiative makes sense. Our work has always been about more than simply selling electricity. We want local solar, home batteries, community batteries, EV chargers and flexible loads to work together in a way that creates value for customers and communities.
The budget doesn’t deliver that. But the funding for the CER Roadmap and the National Technical Regulator is a useful step.
Rebates help get batteries into homes. The next job is making sure those batteries, along with rooftop solar, EV chargers and smart appliances, can actually work together, switch between services, respond to better price signals, and help lower costs across the system.
That is how consumer energy resources can contribute to a fairer, lower-cost energy system.
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.