The Federal Government's Cheaper Home Batteries Program has been a runaway success, with more than 250,000 battery installations supported by the scheme so far.
However, there are major updates in store for the program beginning May. Here's the changes you need to know about.
A new tiered discount
At launch, the program offered a one-off 30% flat discount for the installation of small-scale solar batteries sized between five kilowatt hours (kWh) and 100kWh, with the maximum discount capped at $18,500.
However, that discount is slated to change on May 1. From this date, the value of the discount will depend on the size of the battery installed.
The discount available for your battery is determined by its STC Factor, or how many small-scale technology certificates (STCs) the battery can create for each kWh of usable capacity. From May, this will taper based on each battery's capacity:
- 0kWh up to 14kWh (inclusive): STC Factor applied at 100%.
- 14kWh up to 28kWh (inclusive): STC Factor applied at 60%.
- 28kWh up to 50kWh (inclusive): STC Factor applied at 15%.
So for a 50kWh battery, the STC Factor will be 100% for the first 14kWh of capacity, 60% for 15kWh to 29kWh, and 15% for the remaining capacity to 50kWh. You can still access the program for batteries up to 100kWh, but your discount will only apply to its first 50kWh of capacity.
This means that batteries installed from May onwards won't earn the same discount as they would have earlier, with the biggest reductions for larger batteries. The STC Factor will also decline more frequently (every six months) and at a higher rate, from 6.8 STCs per kWh in May-Dec 2026, to 2.1 in December 2030.
Solar Choice estimates that the rebate for a 10kWh battery could reduce by $608, while a 25kWh battery rebate will go down by $2,657. This example assumes that there are 6.8 STCs offered per kWh of capacity, at a price of $38 per STC.
Why is the Cheaper Home Batteries Program changing?
To discourage unnecessarily large battery installations
The initial 30% flat discount was available for batteries with a usable capacity between 5kWh and 50kWh. However, buyers could claim the maximum discount on batteries sized between 50kWh and 100kWh. Because of this loophole, many buyers increased their discount by installing larger batterie, regardless of their actual energy usage or household size.
According to the Clean Energy Regulator’s Quarterly Carbon Market Report in December, the average household battery capacity installed rose from 19.5kWh in Quarter 3 2025, to 26.8kWh in Q4. For context, an average household of three typically uses 20kWh of electricity daily.
A small battery (e.g. 5kWh to 6kWh) can store roughly between 15kWh and 22kWh daily, which is more than adequate for most homes to store enough energy in the day for use during peak hours. This means those additional kWhs of storage aren’t actually necessary to help homes cut their reliance on the grid.
While larger batteries still add value to Australia’s total storage capacity, additional kWhs of storage are only productive if being used by homes that need it the most. The new tiered discount structure encourages homes to only install the battery sizes they actually need, to avoid the scheme's funding drying up early.
Funding is running out
The Australian Government is pumping more funds into the program because its original $2.3 billion investment was projected to run out in early June 2026 — three and a half years earlier than the scheme’s intended lifespan. To avoid shutting the program down early, the government is tapering discounts and investing an extra $4.9 billion, bringing the total budget up to $7.2 billion.
While more than a quarter of a million batteries have been installed under the scheme, this is still a far cry from the government’s ambitious target of two million installations by 2030.
How do I apply for the Cheaper Home Batteries Program?
If you reach out to an accredited installer or retailer, they will typically apply for the program on your behalf as long as you've installed a Clean Energy Council-approved battery and inverter. The discount will generally be applied at the time of purchase and subtracted from the price of your battery.
You can also apply for the discount directly through the REC Registry, but this process is more complicated.
It’s also important to remember that the above changes will only commence starting 1 May — that means the flat 30% rate is still available until the cut-off date.
If you’re already interested in a solar battery, we recommend researching your options and speaking to an accredited installer for expert recommendations. Our best solar installers page features some of the nation's highest-rated solar installers based on customer feedback.
