The ROI of a battery with rebates

Leading up to the 2025 federal election Labor was proposing a battery rebate for all homes in the country while the Liberals really had nothing on offer. I took a quick look into what the proposal.

At the time before the election is was rumoured the Liberals were working on a battery policy of their own, if they were it never saw the light of day. Nonetheless the proposed Labor program was and is a real game changer.

Labor's $2.3 billion battery rebate could connect one million new batteries

On April 6th 2025, Labor announced its Cheaper Homes Batteries Program which would begin as soon as July 1st of the same year. The proposal itself states that most homes will get a 30% upfront discount on the cost of a battery, quoting that it would equal around $4000 in savings for a typical battery.

So far, the details proposed are:

• An initial subsidy of $372 per kilowatt-hour (kWh)

• The dollar amount of the subsidy will decrease each year until 2030

• Minimum battery size is 5 kWh, so nothing smaller than five kWh will be eligible

• Maximum battery size is 50 kWh - but you can install 100 kWh, it's just the first 50 will be subsidised and the other 50 won't

• Batteries must be capable of being part of a Virtual Power Plant (VPP) program

• Current battery owners can get another battery and it will be eligible

• One rebate per property

• You need to connect the battery to a new or existing system

But take this information with a large pinch of salt, as it's not set in stone, and as we all know, things change in politics.

Like according to Labor's analysis, adding a battery to households with existing solar panels could save up to $1,100 annually on their power bills. And for those installing both new solar and battery systems, the savings could reach an impressive $2,300 per year.

In my experince, these numbers are a bit high. Over the last year, I've run multiple battery analyses based on the actual consumption patterns of homes and used real-world energy pricing to create reports. Rarely do battery savings reach over a $1000 in savings unless the home is a huge consumer of evening electricity. I generally see savings ranging from $400 to $1000 a year. But again this is based on the consumption patterns of the home and local energy pricing. So be aware that the savings of a battery in your home are relative to your consumption and costs, it's not a set dollar amount you can expect.

More energy storage is a necessary step for the future of solar

But if the proposed Labor rebates are true, this program will energise batteries in Australia and help avoid serious growing pains for the grid.

I've talked about it a few times already, but in some parts of the country, homes with solar are considering preventing their solar systems from exporting to the grid simply because they don't want to be penalised for exporting too much renewable energy at certain times of the day, which would be a disaster.

This program could bring home batteries to the rescue, with a home battery that excess solar energy would be stored away and used later in the day when energy prices increase and everyone gets home from work and school. In many ways is the band-aid thats dearly needed to prevent, or at least mitigate, a future where homes are penalised for exporting solar.

Cheap EVs with a bi-directional chargers as part of VPP programs

I'm going to tread lightly here because this is just hypothetical and for arguments sake... But if we wanted to have a stronger battery program, there seems to be an easy win ripe for the taking. That win is to instead focus on EVs and vehicle-to-grid (V2G) chargers that can utilise the car battery to power a home. By making those as cheap as possible through an EV-focused program the home gets an affordable home battery on wheels. Cheap EVs that can support V2G chargers is also a two birds one stone solution, EVs have significantly larger batteries than static home batteries and many Australians of all income levels own and need a car. And so not only would homes of all income levels have greater access to a battery to reduce their reliance on more expensive grid energy during the night, but car emissions would also significantly decrease across the country, which is currently 11% of our total emissions. Admittedly, this would be a far more complex plan to pull off, and the service providers again would be scrambling to make it all work behind the scenes, but if we're going all in on batteries, we might as well go all in. V2G chargers and cars is a topic I am planning to talk about in more detail in a future article. So if youre keen to get more info let me know and I'l take note!

The Labor program is a huge step in the right direction

I think more energy storage in the grid is a necessity, we have an overabundance of solar energy being generated in the afternoon, and so storing that energy to use it later in the day is a no-brainer.

If the best offer on the table is home batteries, then I say let's take it. My only hope is that this is seen as just one step in the marathon towards the complete electrification of Australia. There is still a lot more work to do!

How can a battery benefit YOUR home?

If you're interested in understanding how a battery system might benefit your specific situation, I can help. We can analyse your energy consumption patterns over the past two years and calculate potential savings from a battery installation. Simply reply to this email if you'd like to learn more.