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Section 2: What rebates and incentives are available to Victorians for solar battery systems?

Adding a battery to an existing solar PV system is a significant investment, and for some households the outlay might be more than what you save on energy bills over the life of the battery.

Solar Homes Program battery rebate

The Victorian Government’s Solar Homes Program battery rebate can help pay for the price of a battery system, which will improve the economics, or ‘payback time’ of the system.

The Solar Homes Program provides Victorian households with a rebate of up to $3,500 for batteries. This represents significant savings on an average-priced 11 kilowatt-hour battery.

Understanding the eligibility criteria

In its first year, the Solar Homes Program ran a pilot battery program with eligibility criteria designed to get the most from the battery systems installed each year.

The program is currently available to households in all Victorian postcodes. Check the full eligibility criteria on the Solar Battery Rebate page.

Households eligible for the Solar Battery Rebate must already have solar PV panels with a capacity equal to or greater than 5kW or are arranging to have one installed in conjunction with the solar battery installation.

If you’re looking to install a solar system instead visit the Solar Panel Rebate for more information. Households can only claim one of these two rebates.

The benefits of installing a battery

Some Solar Battery Rebate households may choose to participate in an aggregation program or join a Virtual Power Plant (VPP) trial to help get the most out of the program for participating households, non-solar households and support for the electricity grid.

From 2020-21 the Solar Homes Battery Program will look to expand and add an ‘aggregation’ option for households. This expansion will allow for continuity of the current rebate program while leveraging the benefits of battery aggregation and broaden the benefits of the program for Victorian households and the electricity grid. The Program will continue to seek options to increase the uptake of batteries participating in aggregation projects and support Victoria’s transition to a renewable energy future.

Program objectives

The inclusion of approved Aggregation Projects on the Solar Homes’ Approved Aggregation Program List under the Solar Homes Program is designed to inform the next step in Victoria’s battery aggregation strategy, paving the way for future virtual power plants (VPP’s) and microgrids aimed at delivering benefits not only to householders but across the energy sector.

The intention is to provide a platform for householders to access battery rebates, in partnership with approved and capable providers, build consumer confidence in the benefits of battery aggregation programs and ultimately drive the acceleration of household participation in battery aggregation programs into the future.

Aggregation and VPP’s are a new way to build a power station. Rather than one big facility, a VPP aggregates many smaller decentralised energy resources (DERs) – be it solar, wind or storage – across several locations or households. By using smart technology, all these resources are combined into one large entity, and controlled from a distance by complex algorithms.

The algorithms can focus on different goals: resilience during power outages, grid balance, reduced energy fees or a maximal use of green energy.

VPP’s are efficient and flexible, with their ability to deliver peak load electricity or load-following power generation on short notice. This decentralised (distributed) approach to electricity generation can be effective in controlling grid voltages, and the distributed aspect of such systems means less strain on single areas of the grid.

Icon drawing of three individual household batteries joining together to feed energy back into the centralised energy grid single

With the advent of smart, remotely controlled domestic-scale batteries it has become possible for energy companies to remotely sync up hundreds or even thousands of their customers’ batteries to provide power to the grid when demand is highest, and absorb grid energy when there is excess.

Solar Victoria Approved Battery System list only consists of systems that are VPP-ready to enable Victorians to participate in VPP programs.

Benefits of participating in aggregation projects or a VPP program

  • receive compensation for providing grid services and selling energy to the grid
  • enable greater uptake of Distributed Energy Resources (DER)
  • reduce curtailment of DER
  • reduce network costs for all Victorians
  • grid will operate more efficiently

Most aggregation and VPP programs have specific product requirements, so you will need to review these to ensure the system you are installing is capable of participating in the VPP you want to participate in.

Reviewed 07 October 2021