Is Bigger Always Better? How Battery Size Impacts Your Aussie Subsidy
Thinking about adding a battery to your solar setup? The Australian government's subsidy program is designed to make home energy storage more affordable, but recent changes mean battery size matters a lot when it comes to maximising your savings.
This blog post delves into how battery capacity affects the amount of subsidy you can receive and what this means for Australian households. If you want the in-depth details, check out our Complete Guide.
The Australian Battery Subsidy Scheme: A Quick Recap
The government is investing billions of dollars to encourage more Australians to install home batteries. The goal is to double the number of households with battery storage by 2030, adding significant capacity to the grid and making solar energy available around the clock. The subsidy works through Small-scale Technology Certificates (STCs), effectively providing a discount on the upfront cost of a battery system.
Why Size Matters: The Recent Changes
Originally, the subsidy scheme offered a fairly consistent rebate based on the total capacity of the battery. However, the government has observed a trend: Australians are installing larger batteries than anticipated, which means the subsidy funds are being used up faster than projected.
As a result, the scheme is being revamped to encourage households to install more appropriately sized batteries. The changes will come into effect starting May 2026 and will involve a tiered system where the rebate per kilowatt-hour (kWh) of battery capacity decreases as the battery size increases. Further reductions are planned every six months after the initial change until the end of 2030.
The Impact on Your Wallet: Smaller Batteries, Bigger Savings?
What does this mean for you? In essence, the government is incentivising smaller battery systems. While a large battery might seem appealing, providing backup power for your entire home for days, it might not be the most cost-effective option under the revised subsidy scheme.
Let's break it down:
- Smaller Batteries: Receive a higher rebate per kWh of storage. This means you'll get a larger percentage of the system's cost covered by the subsidy.
- Larger Batteries: Receive a lower rebate per kWh. While you'll still get a subsidy, it will be less generous than for a smaller system.
The government believes this tiered approach will help maintain a discount of around 30% on battery systems, aligning with the declining costs of battery technology.
Why the Change? Addressing Oversized Batteries
The main driver behind this change is the prevalence of oversized batteries. Data shows that since October, the average battery size installed has been around 28kWh, significantly larger than the 10-12 kWh typically installed in the past.
While having ample storage capacity is great, many households don't actually need such large batteries to meet their energy needs. These oversized systems were rapidly depleting the subsidy budget, prompting the government to adjust the scheme to ensure its long-term viability and reach a wider range of households.
What Should You Do? Determining the Right Battery Size
Before rushing out to buy the biggest battery you can find, consider your actual energy consumption and needs. Here are some factors to consider:
- Your Energy Usage: How much electricity do you consume daily? Review your past electricity bills to get an accurate picture.
- Solar Panel Size: The size of your solar panel system will influence how much excess energy you have available to store in a battery.
- Backup Power Needs: Do you need backup power for essential appliances only, or do you want to power your entire home during a blackout?
- Time-of-Use Tariffs: If your electricity retailer offers time-of-use tariffs, a battery can help you store energy during off-peak hours and use it during peak hours, potentially saving you money.
Getting Expert Advice
Navigating the complexities of battery sizing and subsidy schemes can be challenging. It's crucial to seek advice from qualified solar and battery installers who can assess your energy needs and recommend the most suitable battery system for your specific situation.
They can help you calculate the optimal battery size to maximise your subsidy and achieve the best return on investment. They'll also be up-to-date on the latest regulations and rebate amounts, ensuring you don't miss out on any potential savings.
The Future of Home Energy Storage in Australia
The revised subsidy scheme reflects the government's commitment to making home energy storage accessible to more Australians. By encouraging the installation of appropriately sized batteries, the scheme aims to maximise its impact and contribute to a more sustainable energy future.
While the changes may require a bit more research and planning, they ultimately ensure that the subsidy benefits are distributed more equitably, making solar battery storage a viable option for a wider range of households.
