Australia’s energy story in 2025 looks a lot like a plot twist: rooftop solar — long the headline renewable — is still vast and growing on aggregate, but momentum has shifted. Batteries (both home-scale and grid-scale) are surging, reshaping how electricity is produced, stored and used. Below I unpack the drivers, data, and consequences of this shift — what’s changing, why it matters, and what to watch next.
1) What the 2025 numbers actually show
- Battery boom: 2025 saw record household battery uptake and major new grid-scale projects. In the second half of 2025 alone, Australia installed a historic number of residential batteries as programs like the federal Cheaper Home Batteries scheme kicked in. Industry trackers and the national reports show household battery capacity jumping materially in 2024–25.
- Solar growth cooling (not collapsing): Rooftop solar remains enormous — Australia has among the highest per-capita rooftop PV penetration globally but small-scale PV installations in 2025 were forecast to fall compared to 2024 in several analyses, reflecting a near-term slowdown in new rooftop installs even as average system sizes continue to rise.
- System-level impact: AEMO’s 2025 outlooks note rising storage capacity and changing net-injection behaviour (storage moved from net withdrawal to net injection quarters), signalling batteries are actively shifting when energy is supplied to the NEM.
2) Why batteries are winning: Five core reasons
- Policy and direct subsidies are firing the starting gun
The Federal Cheaper Home Batteries program and related incentives made battery economics suddenly much more attractive for households in mid-2025. Where rooftop solar used to be the main subsidy focus, targeted storage support pushed many consumers to prioritize batteries (or combined solar-plus-battery packages). This changed purchase decisions rapidly. - Cost declines and better value propositions
Battery costs have fallen dramatically over the past decade, and system pricing (including installation, inverters and software) reached levels where the payback for time-shifting solar to evening peaks looks much better than exporting cheap midday solar to the grid. Globally, battery deployment economics improved markedly in 2024–25, reinforcing local adoption. - Export and network limits make storage more attractive
Many distribution networks now limit how much solar a rooftop system can export during peak generation (often through inverter export caps, dynamic controls or network constraints). In that environment, adding storage increases the household’s usable value from each kW of panels — you store what you can’t export and consume it later. That changes the marginal benefit from more solar panels to more battery capacity. - The rise of virtual power plants and grid services
Batteries can do much more than save money for a single home: aggregated batteries (virtual power plants, or VPPs) can provide frequency control, capacity at peaks, and firming services that were traditionally filled by gas or coal. Network operators and commercial players are increasingly paying for these services, creating revenue streams that make batteries commercially attractive even beyond household bill savings. - Consumer preferences and energy security concerns
After years of price shocks and rising interest in energy independence, many households prefer the control batteries offer — less exposure to volatile retail prices, more resilience during outages, and a perception of “self-sufficiency.” When subsidized and cheaper, that emotional and practical value translates directly into installations.
3) Why solar growth cooled in 2025 (the mechanics)
Solar cooling is shorthand — rooftop PV in Australia didn’t vanish. Instead, several interacting forces slowed its rate of new installs:
- Saturation & diminishing marginal benefit: In suburbs with very high PV penetration, adding panels without storage often means more power exported at times of low wholesale value. For many households the incremental value of a few extra panels dropped, so buyers opt for larger systems less frequently or add batteries instead.
- Network export controls & technical limits: Export caps and dynamic export settings reduce the revenue a household can get from exporting midday solar, lowering the incentive for larger rooftop-only arrays.
- Policy pivot toward storage: Government programs prioritized battery deployment in 2025, shifting consumer subsidy-driven demand away from pure solar installs.
- Project and supply-chain dynamics for bigger projects: At the utility scale, financing, approvals and grid connection delays slowed some new solar farm investment in 2025 — a different but complementary story to the small-scale market slowdown.
4. What’s Driving the Record Demand?
The surge in battery demand stems from a mix of key factors:
- Government rebates — The Cheaper Home Batteries program made storage more affordable and quickly boosted installations.
- Increasing energy independence — Rising electricity costs and interest in resilience solutions push households to install batteries.
- Shift from exports to storage — Network export limits on solar often favour adding storage so more energy can be consumed at home or put back at higher value.
- Declining battery costs — Falling prices and improving tech make batteries a more attractive investment than ever.
The Numbers Behind the Boom
Australia’s home battery market has shifted from steady growth to rapid acceleration. In 2024 alone, tens of thousands of battery systems were installed nationwide, but 2025 has taken this momentum to a new level. The introduction of battery eligibility under the Small-scale Renewable Energy Scheme through the Cheaper Home Batteries program has unlocked pent-up demand, pushing approvals sharply higher within the first months. For the first time, battery installations are now growing faster than rooftop solar, signalling a clear change in how households are investing in their energy future.
What’s Driving Australians to Add Batteries?
Beyond the headline numbers, the real driver of battery adoption is simple household economics. Grid electricity prices continue to climb, while feed-in tariffs have steadily fallen, meaning exporting excess solar now delivers minimal returns. At the same time, new federal incentives have significantly reduced the upfront cost of adding a battery, especially when paired with an existing or new solar system. Together, these forces are shifting the equation toward self-consumption — storing solar during the day and using it at night — making batteries a logical next step for Australians looking to protect themselves from rising energy costs.
Final Section: Is 2026 the Right Time to Add a Battery?
With battery prices continuing to fall, incentives remaining strong, and more Australian households already proving the value of storage, 2026 is shaping up as an equally compelling time to add a battery. As electricity tariffs rise and feed-in rates remain low, solar-plus-battery systems are increasingly becoming the practical choice for homeowners who want long-term bill stability and greater energy independence. For many, the question is no longer whether a battery makes sense, but when.
Solar Secure can provide a personalised assessment of your home’s energy usage, local tariffs, and available incentives, then design a solar-plus-battery solution aligned with your budget and goals. Contact our team to receive a tailored proposal and take the next step toward smarter energy in 2026.