Virtual Power Plant incentive update from 1 July 2025
The incentive to connect your battery to a Virtual Power Plant will increase from Tuesday 1 July 2025.
This will almost double the upfront incentive you’ll receive. For example, the payment you receive for a 27 kWh battery will increase from around $800 to around $1,500.
This incentive can be combined with the Australian Government’s Cheaper Home Batteries Program discount.
Future changes to our battery incentives will be updated on this page. Sign up here to also receive email updates about battery incentives.
You can receive an incentive for connecting your solar battery to a Virtual Power Plant (VPP). In addition to this incentive, connecting to a Virtual Power Plant allows you to sell your excess electricity to the grid on an ongoing basis to power your neighbours’ homes while you get paid.
If you don’t already have a battery installed, you can also access a discount through the Australian Government’s Cheaper Home Batteries Program.
What is a Virtual Power Plant (VPP)?
Virtual Power Plants are connected groups of solar batteries that allow excess stored power to be shared during times of peak demand. There is no extra physical connection – the Virtual Power Plant is operated remotely by the provider.
Participating in a Virtual Power Plant can help you:
- make money selling your battery’s excess stored electricity, like the payments you can receive for selling your solar power to the grid
- pay your solar panels and battery off faster
- support the grid during peaks in demand to keep power costs down, the lights on, and decrease NSW’s reliance on fossil fuels.
Connecting more batteries across NSW to Virtual Power Plants will help make the grid more reliable and stable during periods of peak demand. This will help reduce NSW’s emissions by 70% by 2035 and achieve net zero by 2050.
How you can make money by connecting to a Virtual Power Plant
Connecting your battery to a Virtual Power Plant will allow you to be paid both:
an upfront payment through this incentive when you connect your battery to a Virtual Power Plant
- on an ongoing basis, as you continue to sell your excess stored energy to the grid through your Virtual Power Plant arrangement.
The upfront incentive you receive depends on the usable capacity of the battery in kilowatt-hours (kWh). Larger batteries will receive a larger incentive.
From 1 July 2025, the incentive amounts you can receive are:
- approximately $550 for a 10 kWh battery
- approximately $1,500 for a 27 kWh battery.
The incentive can be claimed once per National Metering Identifier (NMI), or unique electricity meter.
The incentive amount you receive depends on the terms and conditions of the specific Virtual Power Plant you sign up for. You may receive the incentive in instalments, as an upfront payment or discount off a new battery install, or as credit off your power bill.
Not all batteries can be connected to a VPP, so check before you purchase. All batteries installed through the NSW Peak Demand Reduction Scheme are able to be connected to VPPs.
How to access the incentive and connect to a Virtual Power Plant
Important information:
We want to ensure you are always protected. Before you begin, it’s important to know that as a consumer, you have basic rights, called consumer guarantees, to hold certain expectations when buying a product or service from a business. These basic rights are protected under Australian Consumer Law. Visit the Australian Competition and Consumer Commission website to learn more.
Please also read our terms of service.
Contact multiple Virtual Power Plant providers. It’s a good idea to compare offerings from more than one provider. Each provider offers different conditions, such as the price you receive for your excess electricity, and the timing of when the Virtual Power Plant can access your battery.
Virtual Power Plant providers will check your eligibility for receiving this incentive.
Virtual Power Plant providers work independently from the NSW Government, choosing which battery models they work with, which locations they operate in, and what services they offer.
Depending on your Virtual Power Plant provider, you may need to change your electricity retailer. Not all electricity retailers are compatible with Virtual Power Plants.
Virtual Power Plant providers offering the incentive include:
If you are a Virtual Power Plant provider offering the incentive through an Accredited Certificate Provider (ACP) and would like to be listed here, please contact us at [email protected]
Your chosen Virtual Power Plant provider will give you a contract and nomination form.
You must sign the nomination form before you can receive any incentive.
The Virtual Power Plant provider will also ask you to sign a contract that specifies the conditions of how they will access your battery. This can include how much you will be paid, how much battery capacity they can access, and when they can access your battery’s energy to contribute to the grid.
They will also provide you with a fact sheet with information and FAQs on how to connect to a Virtual Power Plant. If you have any issues or questions, contact your Virtual Power Plant provider for assistance.
Once you have completed the paperwork, your Virtual Power Plant provider will give you a cooling off period.
During this cooling off period, you can continue to consider whether the Virtual Power Plant arrangement you’ve been provided is right for you. If you would like the change the conditions of the contract or cancel the contract, contact your Virtual Power Plant provider.
Once the cooling off period has ended, the Virtual Power Plant provider will provide you an online form to complete. Once this form is completed and your details are confirmed, you will receive your incentive.
Who to contact if you have questions or issues
If you have any questions or issues with this incentive, you should contact your Virtual Power Plant provider.
If you are unable to resolve matters, you may ask NSW Fair Trading to assist you.
If you are unable to identify your Virtual Power Plant provider or if you have concerns about the conduct of a provider or their representatives with respect to this incentive, you should contact the scheme administrator, the Independent Pricing and Regulatory Tribunal (IPART).
FAQs
If you have already claimed the NSW Government’s Virtual Power Plant incentive between 1 November 2024 and 30 June 2025, you are unable to claim the incentive again. However, your Virtual Power Plant provider may contact you regarding additional incentives that you may be eligible for because of this change.
Yes, if you have installed a battery using a discount from the Australian Government’s Cheaper Home Batteries Program, you can also take advantage of the NSW Government’s incentive for connecting a battery to a Virtual Power Plant (VPP).
Virtual Power Plant providers manage multiple connected batteries to share excess stored energy to the grid.
Each provider offers different conditions, such as:
- the price you receive for your excess electricity
- the timing of when the Virtual Power Plant can access your battery
- how much battery capacity the Virtual Power Plant can access.
Each provider offers different conditions, so you should compare offers from multiple providers.
Virtual Power Plant providers work independently from the NSW Government, choosing which battery models they work with, which areas they operate in and what services they offer.
You can benefit from connecting your battery to a Virtual Power Plant by:
- receiving an upfront payment through this incentive
- making money selling your battery’s excess stored electricity, like the payments you can receive for selling your solar power to the grid
- earning money to help you pay off your solar panels and battery faster.
To be eligible for this incentive you’ll need:
- solar panels
- an eligible battery – batteries installed under the NSW Government incentive are eligible. If you don’t have a battery, from 1 July 2025 the Australian Government’s new Cheaper Home Batteries Program will provide households and businesses a discount when installing an eligible battery.
- to use a Virtual Power Plant provider. Depending on your Virtual Power Plant provider, you may need to change your electricity retailer.
Batteries with a storage capacity between 2 and 28 kWh are eligible for this incentive. The incentive provided depends on the usable capacity of the battery.
No. If your battery is not connected to the grid, you are unable to join a VPP.
From 1 July 2025 the Australian Government’s new Cheaper Home Batteries Program will become available. This provides households and businesses a discount when installing an eligible battery.
More battery information
Learn more about battery storage, including how to install and how to make the most of them.
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