The New South Wales government is doubling its incentive for households and small businesses to install solar batteries and connect them to a local network.
It will piggyback with the federal government's Cheaper Home Batteries program which provides support to people and businesses installing small-scale solar battery systems.
Both programs take effect from 1 July 2025.
The federal scheme will provide a discount of around 30% on the upfront cost of installing eligible small-scale battery systems around Australia.
The discount will be based on the battery's usable capacity and will gradually decrease until 2030.
NSW gets connected
At the same time, the New South Wales government will be doubling its incentive by up to $1,500 to encourage more households and businesses to take up the federal scheme and connect their batteries to a 'virtual power plant' network.
Virtual power plants are a connected group of privately owned solar batteries that can sell excess stored power to the electricity grid.
Connecting with local plants effectively allows allows homeowners to generate revenue by selling their excess storage to their neighbours and community when demand on the electricity grid is high.
Not only do the plants ease demand, but they can effectively prevent price spikes and drive down the price of electricity for everyone.
Talking dollars and cents
For a household installing a typical 11.5 kilowatt-hour (kWh) system, the combined government support would be around $5,000.
A larger 27 kWh battery (costing $30,000 without government support) would receive a discount of around $10,000 and an upfront payment of $1,500 from the NSW scheme if the battery connects to a virtual power plant.
Even a smaller 6 kWh battery can attract almost $2,700 in combined subsidies.
Solar leading the way
The state's new Virtual Power Plant incentive will replace the NSW government's current battery installation incentive, with the new federal scheme effectively doubling the incentive.
The NSW government said its state-based battery rebate has been a huge success, with more than 11,400 batteries installed around the state in just six months.
Anyone who's already installed a compatible solar battery that isn't yet on a network is eligible for the newly doubled incentive from 1 July.
NSW Minister for Climate Change and Energy Penny Sharpe said the state is now focussing on getting individual solar batteries to connect.
"We know the best benefit for the grid comes when these batteries are linked together and NSW wants to be world-leading in encouraging households and small businesses to be part of that," she said.
How does a virtual power plant work?
Virtual power plants are set up by a provider that remotely tracks available energy.
They have the capacity to earn more than electricity sold through grid-connected solar because they can continue to sell excess stored electricity at night, generally when demand - and prices - can be higher.
For those interested in installing a solar battery, see details of the federal government's Cheaper Home Batteries Program.
For details of the NSW government's incentive, see Connect your battery to a Virtual Power Plant (VPP).
Not all batteries can be connected to a virtual power plant, so it's advised to check before any purchases are made.
It's also worth noting pricing, timing, and other conditions of joining a virtual power plant will be set down in a contract through a provider.
Advertisement
If you're looking to build an environmentally friendly home or make a green addition to your existing home, here are some of the most competitive green home loans on the market.
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Extra Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.93% p.a. | 6.19% p.a. | $2,471 | Interest-only | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.33% p.a. | 5.33% p.a. | $2,786 | Principal & Interest | Variable | $0 | $0 | 80% | |||||||||||||
5.44% p.a. | 5.49% p.a. | $2,820 | Principal & Interest | Variable | $null | $null | 60% | |||||||||||||
5.64% p.a. | 5.69% p.a. | $2,883 | Principal & Interest | Variable | $0 | $500 | 60% | |||||||||||||
5.49% p.a. | 5.95% p.a. | $2,836 | Principal & Interest | Variable | $0 | $530 | 90% |
| Disclosure |
Image by Kindel Media via Pexels
Ready, Set, Buy!
Learn everything you need to know about buying property – from choosing the right property and home loan, to the purchasing process, tips to save money and more!
With bonus Q&A sheet and Crossword!
William Jolly
Hanan Dervisevic
