In Australia, a home battery boom has helped cut wholesale power prices
NSW Climate and Energy Action
A little more than one year ago, Australia rolled out a program to heavily subsidize home batteries, part of a larger effort to make use of the huge volumes of solar energy that were going to waste. On Friday, officials announced that more than 500,000 batteries had been installed under the plan, helping to slash wholesale power prices roughly in half.
Energy Minister Chris Bowen said that Australia now has more home batteries than the United States, which has a population 12 times larger. “This is a story of global significance that Australian households have achieved,” Bowen said in a press conference.
Australia is the world leader in rooftop solar, with panels installed on more than one in three households, the highest rate of adoption globally. But abundant solar power has created a new dilemma as the grid faces a surge of electricity from connected rooftop arrays. Power prices plunge. Centralized power plants are forced offline, threatening grid stability. And much of that solar power goes to waste.
The government has moved to make use of this surplus solar energy, including by offering free power in the early afternoon to homeowners in Queensland, New South Wales, and South Australia, regardless of whether they have solar panels on their roof or not. The goal is to spur more consumers to run appliances or charge electric vehicles during this window.
With its home battery subsidy program, launched in July 2025, the government is aiming to help households use more solar energy by providing a 30 percent discount on residential battery systems connected to solar arrays.
The subsidy program has spurred a boom in installations. Australia is on track to more than double its home battery capacity this year, Bloomberg reports. The program has also been a boon to the grid. By relying on batteries in the early evening, when demand peaks, homeowners are reducing the need for utilities to fire up additional power plants during those hours, which is helping to lower costs for other ratepayers, officials say.
The subsidy program has been “the major factor in the wholesale price of energy falling in Australia by 47 percent in the last 12 months,” Bowen said. “Australia is one of the very, very few countries in the world which is reducing wholesale prices in the midst of a global energy crisis.”