A NSW Government website

Incentives for residential batteries

Latest update

We've updated these planned changes as of May 2024

New battery incentives will be available from 1 November 2024. 

To take advantage of these incentives you will need to work with an accredited supplier.

Homes and businesses with rooftop solar will soon be able to take advantage of Peak Demand Reduction Scheme (PDRS) incentives to install residential battery storage and connect to a Virtual Power Plant (VPP). These incentives will help homes and businesses maximise the use of the solar energy they generate and cut the cost of electricity bills.

Installing more batteries across NSW will help make the grid more reliable and stable while also reducing our reliance on fossil fuels during periods of peak demand. This will help reduce NSW’s emissions by 70% by 2035 and achieve net zero by 2050. 

Incentives available from 1 November 2024

If you’re eligible, you could access incentives:

  • between $1600 to $2400 off the up-front installation costs of a battery for homes and businesses with existing solar, depending on the size of the battery
  • between $250 to $400 for connecting your household or business battery to a Virtual Power Plant (VPP). This incentive is available twice, a minimum of 3 years apart.

For homes and businesses without solar, the incentive can be priced into a quote for a new solar and battery system installation.

The installation incentive is usually provided as an upfront discount by the approved supplier. Different suppliers will offer different commercial products, services, and incentives – giving you choice to shop around. 

Learn more about residential batteries and these incentives by reading our FAQs.

Prepare your home or business for a battery

Contact an approved supplier

Approved suppliers can claim these incentives for work completed from 1 November. We will update this page and direct you to the list of approved suppliers as they become available. 

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Battery incentive FAQs

Does the incentive money get paid to the customer or approved supplier? 

The incentive is not a direct rebate to customers. It’s usually provided as an upfront discount by the approved supplier that installs the battery or operates the VPP. 

What is an approved supplier?

Approved suppliers are known as Accredited Certificate Providers (ACPs). These are businesses that have been accredited by the Scheme Administrator (IPART) to conduct specific installations and upgrades under the Peak Demand Reduction Scheme.

Why are the incentives not available until November? 

The incentives will be available from 1 November 2024 to give the Scheme Administrator (IPART) time to establish its compliance processes, accredit the approved suppliers and engage and train staff for conducting audits. 

What is a Virtual Power Plant? 

Virtual Power Plants (VPPs) are systems of interconnected batteries managed by a VPP operator. When needed, the VPP coordinates the release of energy stored in the batteries to the grid to address frequency and voltage imbalances, local disruptions or disturbances and keep the network stable.    

What does participation in a VPP mean for customers? 

Participation in a VPP means that customers will agree to have their battery managed by a VPP operator. The battery owner and VPP operator will define the individual details, such as dispatch conditions, in the agreement. 

The PDRS provides an incentive for proof that a battery has joined a VPP. 

How does participation in a VPP benefit customers?

Customers can receive financial incentives for joining a VPP, lowering the payback time of their solar and battery system. 

Are there any requirements to be eligible for the battery incentives? 

Yes, you’ll need to have rooftop solar installed on the premises and use an approved supplier under the PDRS to install the battery. 

Does the installation cost include the battery itself?

Generally, installers will provide a quote that states both the cost of the battery and the installation separately. However, installers have full discretion to choose how they quote, and some may instead provide a single all-inclusive price. 

We recommend keeping a record of communications that clearly states the inclusions and exclusions of a quote before any money changes hands.  

Why is eligibility limited to batteries between 2 and 28kWh in capacity? 

This is to be consistent with schemes in other Australian states.  Most eligible sites will only need batteries under 28kWh. The national average energy use for a five-person household is 25kWh per day. 

Can I receive an incentive for a battery that is already installed? 

The installation incentive will only be available for new battery installation.  The VPP participation incentive is available for already-installed batteries, provided that the battery is signed onto a VPP, has 6 years of the manufacturers’ warranty remaining and meets the equipment requirements. 

Is it safe for me to install a battery in my home? 

Provided that all equipment and implementation requirements of the standards are met, as required in the PDRS, and ongoing maintenance and monitoring are conducted, there is a very low risk of a battery causing a fire. 

Approved suppliers under the PDRS will be subject to additional compliance checks to ensure compliance with strict safety requirements, including professional installation and adherence to relevant standards and regulations. 

Can I pick the make and model of the battery that I install? 

Yes. Provided that the model appears on the approved product list specified by the Scheme Administrator and all the equipment and implementation requirements specified in the Rule are met. 

If an approved supplier doesn’t offer the battery you want, shop around and find one who does. 

Can I receive the battery incentive if I am off-grid? 

No. The PDRS aims to reduce the load on the electricity grid. Off-grid batteries cannot help reduce the load. 

What safety considerations should I prioritise when installing a home solar battery? 

Ensure compliance with relevant Australian standards and regulations for installation and operation. Choose proper battery design, ventilation, and professional installation to prevent overheating and ensure optimal operation. 

Approved suppliers will need to work with tradespeople who are licenced to do the work. The person doing the work needs to be listed on the Clean Energy Council’s list: https://www.cleanenergycouncil.org.au/consumers/find-an-installer