Battery, solar schemes set to zap household bills by up to $1000

Oct 20, 2024

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Both major parties are quietly drafting schemes to partly subsidise households to install batteries and rooftop solar panels ahead of the next federal election, which experts say could save bill payers up to $1000 a year.

With the cost-of-living crisis dominating community concerns, Canberra insiders and energy industry players say the Albanese government and Peter Dutton’s opposition are working on household electrification policies to take to the next election, due by mid-May next year.

Experts says households could save $1000 a year in energy costs with rooftop panels and a battery. Credit: Jason South.

These schemes are expected to include a fund to provide rebates to property owners who buy a battery and potentially to fund some households to install solar panels as well.

The Clean Energy Council has crunched the numbers and found an average household with rooftop solar panels would cut its bill by about $1000 a year with the addition of a battery. Households in NSW and Victoria are now paying about $1600 a year in power bills.

Home owners with rooftop solar can run their appliances from the electricity generated by their panels during the day and typically there is enough excess to recharge an average-sized battery as well.

The battery can then be discharged when the sun starts sinking, enabling the household to avoid periods of peak power prices in the evening, when electricity is in highest demand and people return from work.

Green Energy Markets director Tristan Edis said much of the recent political rhetoric on energy, with the federal government promising to lower power bills by $275 by the end of 2025 and the opposition pledging to build nuclear reactors in a bid to lower consumer costs, had missed the mark.

“Politicians are focused on the wrong thing. The best way to help householders reduce their energy bills is to help them reduce their need for energy from the grid, rather than reduce the price of energy from the grid,” Edis said.

“Households with solar could expect to save somewhere between $500 to $1000 per year by adding a battery system of around 10 to 15 kilowatt-hours of storage.

“The bill savings to households from a combination of solar plus batteries dwarf the Labor Party’s election promise of a $275 saving.”

Batteries start at roughly $10,000 and, with household budgets already stretched by the rising cost of living, extra financial support would be welcomed, despite state schemes now offering modest assistance.

NSW provides a grant for household battery buyers of up to $2400, while in Victoria a four-year interest-free loan of up to $8800 is on offer.

More than 3 million homes have installed solar panels on their roofs, with the average cost of installation being about $6000. But just 250,000 homes have installed batteries, consultancy SunWiz said.

Mamoon Reza said the solar panels and batteries he installed last year had delivered a $1500 turnaround in his energy expenses.

Reza, his wife and two teenage children live in Newtown, Sydney, and their previous electricity bills were $1200.

However, after installing a huge 13.5 kilowatt-hour array of rooftop panels and an average-sized 10 kilowatt-hour battery he wiped out his last annual power bill and earned $300 by sending power from his battery back to the grid.

“I would definitely support a federal government rebate that’s across the country for batteries,” he said, arguing that, despite the high upfront costs, households would save money over time.

He spent about $11,500 on his solar panels and about $10,000 on the battery.

Reza, a self-declared energy nerd, is a customer of Amber Electric, which gives subscribers access to wholesale electricity prices rather than a retail price and allows them to earn by exporting power from their homes back into the grid.

But he concedes many people would not have the time or inclination to actively manage their electricity and use a system like Amber that rewards homes that discharge their batteries into the grid.

“There is a lot of misinformation swirling around and people should understand that the payback time [for panels and batteries] will be just consumption-based,” Reza said.

“If you’re not selling some of the excess energy you have, you will still save money but you probably won’t be in credit.”

The Renew Australia for All campaign has been formed by a wide range of industry groups, the ACTU and social welfare advocates such as ACOSS and the Uniting Church.

It is calling for $5 billion in funding from the next federal budget, to be spent in the next financial year on helping households install solar panels and batteries, and $50 billion over 10 years to help all Australian homes install rooftop solar, batteries and electric appliances.

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