How the federal battery rebate works in 2026

The federal battery rebate is not a cheque from the government. It is a discount on the price of your battery, funded by certificates that are created on the battery's usable capacity and then sold. How big the discount is depends on the size of the battery and on the date your certificate of electrical compliance is issued.

What the Cheaper Home Batteries Program is

The Cheaper Home Batteries Program is a federal program that took effect for batteries installed on or after 1 July 2025. It runs until the end of December 2030.

It uses the same certificate system that has discounted rooftop solar for years. Each eligible battery creates small-scale technology certificates, or STCs. These are tradeable: businesses that are required to buy them pay for them, and that money flows back to you as a lower price. If you want the solar side of the story, see how solar STCs work.

How the discount is calculated

There are four steps. Knowing them helps you check a quote.

Step 1: start with usable capacity

Batteries have two capacity figures. Nominal capacity is the total energy the cells can hold. Usable capacity is the part you can actually draw on, and it is normally lower. The rebate is worked out on usable capacity, so look for that number on the spec sheet and the quote. Our guide on what size battery you need explains more.

Step 2: apply the size taper

Not every kilowatt-hour counts equally:

• The first 14 kWh of usable capacity counts in full.
• Capacity above 14 kWh and up to 28 kWh counts at 60%.
• Capacity above 28 kWh and up to 50 kWh counts at 15%.

Batteries from 5 kWh up to 100 kWh nominal capacity are eligible, but only the first 50 kWh of usable capacity creates STCs.

Step 3: multiply by the STC factor

The STC factor is a multiplier set by the government for each period. It is falling every six months:

• 6.8 for May to December 2026
• 5.7 for January to June 2027
• 5.2 for July to December 2027
• then 4.6, 4.1, 3.6, 3.1, 2.6 and finally 2.1 for July to December 2030

The factor was cut on 1 May 2026, so older articles showing bigger discounts may be using the old numbers.

Step 4: round down and put a price on it

The result is rounded down to a whole number of certificates. Each STC is then worth whatever the installer can sell it for. The STC Clearing House price is $40 excluding GST, and that works as a ceiling. Certificates may sell for less than that, so we use a range of $37 to $40 per STC.

Here is a 16 kWh usable battery with a certificate issued in 2026. The first 14 kWh at the full rate, times the 6.8 factor, gives 95.2. The next 2 kWh at 60% gives another 8.16. That adds up to 103.36, which rounds down to 103 STCs, worth about $3,810 to $4,120.

Examples now and from 1 January 2027

Values use $37 to $40 per STC and are rounded to the nearest $10. For other sizes, try the battery rebate calculator.

Who claims it, and why it shows up as a discount

The system owner can create the certificates, but most households sign that right over to their installer or retailer (or an agent) in the paperwork. The installer creates the STCs after the job is done, sells them, and gives you the value up front as a lower price.

That is why the "rebate" appears as a line on your quote rather than as money in your account later. It also means the size of your discount partly depends on the price per STC your installer assumes. When you read a quote, look for:

• the usable capacity the discount is based on
• the number of STCs
• the price per STC and the total discount
• the final price you pay after the discount

A bigger discount line does not always mean a cheaper battery, so compare final prices and what is included. See how to compare solar quotes.

The compliance certificate date trap

The factor that applies is the one in force on the date your certificate of electrical compliance is issued. That is the document your electrician issues when the work is finished. It is not the date you signed the contract or paid a deposit.

This matters most near the end of a period. Say you sign in November expecting a December install. Parts arrive late, the job moves into the new year, and the certificate is dated in January 2027. The factor is now 5.7, not 6.8, and a 13.5 kWh battery creates 15 fewer STCs, roughly $560 to $600 less.

Before you sign, ask:

• Is the quoted price fixed, or will it change if the discount changes?
• If the job finishes after 31 December, who covers the difference?
• What is a realistic installation date, and what could delay it?

Get the answers in writing, and be wary of anyone who uses the deadline to rush you. The ACCC reported in July 2026 that complaints about home batteries had more than doubled on the year before. A looming factor change is easy to use as a pressure line, so read our list of sales tactics to walk away from.

What the 1 January 2027 step-down means

The drop on 1 January 2027 is the next of several. Every six months the factor falls again, so the same battery gets a smaller discount. That is not a reason to panic-buy. Your usage, the battery price and the quality of the installer usually matter more than a few hundred dollars, and battery prices can move either way. It does mean that waiting has a cost worth knowing about.

Who is eligible

To qualify for the federal discount, the installation generally needs to meet all of these rules:

• installed on or after 1 July 2025
• paired with solar, either existing or new, with the solar system under 100 kW
• battery and inverter both on the Clean Energy Council (CEC) approved list
• installed with a Solar Accreditation Australia (SAA) accredited installer present
• VPP-capable if connected to the grid, meaning able to join a virtual power plant (joining one is optional)
• one discounted battery per premises, although an addition of at least 5 kWh can qualify if the existing battery never received support
• portable batteries and electric vehicles are not included

Since 1 March 2026, installers must also take geotagged, time-stamped photos of the battery's labels for compliance checks. That is one more reason to use an accredited business that does the paperwork properly. Check your eligibility with your installer rather than assuming.

Stacking with state programs

Some states offer extra support on top of the federal discount, such as the NSW virtual power plant incentive and the WA Residential Battery Scheme. Others have closed their programs. See the rebates overview for what is open now.

The short version

• The federal battery rebate is a discount on your quote, funded by STCs created on the battery's usable capacity.
• The first 14 kWh counts in full, the next 14 kWh at 60%, and 28 to 50 kWh at 15%.
• The factor is 6.8 until 31 December 2026, then 5.7, then lower every six months until the end of 2030.
• The date on your certificate of electrical compliance sets the factor, so agree in writing what happens if the job runs late.
• Compare final prices, not discount lines, and get more than one quote.