By now, you are likely familiar with the latest buzz: the government is offering a very generous rebate to help households install solar batteries. But like most things that sound great, it raises a few questions. Who qualifies? How much will you actually save? And is it all too good to be true?

We’ve helped hundreds of customers through this process already, and the truth is: it’s not complicated, if you’ve got the right partner guiding you through it.

The program applies to new solar battery systems with a usable capacity between 5-50 kWh, whether installed with a new solar system or connected to an existing one. 

The rebate is available to homes, businesses, and for off-grid. 

To claim the rebate for Off-Grid, you need to be 1km or $30k away from a connection point (transformer). You will need to provide proof by acquiring a quote from a level 2 electrician or the network provider in your area showing the cost to connect.

The Federal Battery Rebate can only be claimed once per eligible property; receiving the best advice is critical.  You cannot claim it again for the same property, even if you replace or add to your existing battery system, once you have received the rebate.

To maximise your rebate for a solar battery system, select a company that truly understands your energy requirements. Then, opt for a battery that has a usable capacity tailored to those needs and qualifies for the highest possible rebate.

Understand Battery Capacity:

Nominal Capacity: This is the total amount of energy a battery can hold at full charge. Note: the rebate is not paid on this number; it is paid on the usable capacity.

Usable Capacity: This is the amount of energy you can actually draw from the battery, and it’s usually less than the nominal capacity to avoid full discharge (depth of discharge).

Example: A battery with 10 kWh nominal capacity might have a usable capacity of 9 kWh if the depth of discharge is 90%

It is crucial to consider this when selecting your battery, as each battery has a different usable capacity that is specified by the manufacturer and is aligned with their warranty. 

Consulting with a professional solar company is essential when making these decisions to ensure you fully capitalise on the rebate. Keep in mind that you only get one chance to seize this opportunity.

For a more detailed breakdown on nominal and usable battery, please see our other blog Battery Nominal/Useable Capacity & what you need to know

VPP Compatibility:

While participation in a Virtual Power Plant (VPP) is not mandatory to receive the rebate, the batteries must be VPP-capable, unless the system is off-grid. 

If you choose to connect it to a Virtual Power Plant (VPP), you will receive a contract and nomination form from the VPP provider. You will need to sign the nomination form and the VPP contract, which outlines the terms of VPP participation.  

The NSW Government is offering a VPP incentive BESS 2

From 1 July 2025, the incentive amounts you can receive are: 

– up to $550 for a 10–kWh battery 

– up to $1,500 for a 27–kWh battery. 

Eligibility for BESS 2 VPP Incentive: Customers must have a solar battery, with a minimum of 6 years of warranty, and a size between 2 kWh and 28 kWh. The system also needs to be connected to the electricity grid, excluding off-grid setups. 

Upfront Discount:

The discount is applied upfront at the time of installation, reducing the initial cost of the battery.

Per kWh Discount:

The discount is based on the battery’s USABLE capacity (kWh). For example, larger batteries receive a larger incentive.

Maximum Discount:

The maximum possible subsidy is ~$372 per usable kWh of battery storage. This amount is for wholesale traders and will be less when admin processing fees have been applied by the solar installation company. The estimated amount you receive for you battery rebate should be clearly outlined on your quote.

Decline Over Time:

The subsidy amount decreases each year until the end of 2030, when the scheme concludes.

How to Claim:

The installation must be performed by an accredited installer who is also a Clean Energy Council (CEC). See below for more info regarding safety and CEC guidelines.

STC Creation:

• The installer will complete the paperwork and compliance requirements to claim the Small-scale Technology Certificates (STCs) on your behalf, which represent the upfront discount. 
• At the end of the installation, you will be sent a link from your installer’s nominated STC trader to sign, so your STC’s can be applied to your installation.
• It’s recommended to discuss the specific details of the rebate and how it will be applied with your chosen installer. When using Mega Watt Power will deduct the calculated rebate for your battery kWh from the quote and list the STC calculated rebate deduction amount in the quote payment details. 

Combining Rebates:

• The federal battery rebate ( Cheaper Home Batteries Program), can be combined with state-level incentives, such as the NSW Virtual Power Plant, VPP incentives, for additional savings. 

Checking and Signing the quote: 

• The battery rebate discount that will apply for the usable battery kWh selected should be deducted from the total system price outlined in the breakdown on your quote, meaning you’ll pay less for the battery installation upfront. 
• Understanding all the battery components required to qualify for the rebate is essential before accepting any quote. Currently, we are noticing that customers are receiving quotes from other companies for Tesla or Sigenergy batteries, yet the Battery Gateway is often excluded. The Gateway component is needed to claim the rebate for these batteries.
• Always ask, will this battery be able to provide backup energy when the grid fails?

Key Functions of a Home Battery Gateway:

Backup Power: The primary function is to automatically switch to backup power when the grid experiences an outage, ensuring your home remains powered.

Energy Management: Gateways allow for monitoring energy usage, optimising self-consumption, and managing time-based control of the battery.

Monitoring and Control: Users can monitor battery status, charge levels, and adjust settings through a dedicated mobile app, like the Tesla app.

Integration with Solar: Gateways enable the battery to work with solar systems, allowing for storage of excess solar energy for later use.

Safety: The gateway prevents the battery from feeding power back into the grid during an outage, ensuring the safety of electrical workers.

Examples of Batteries with Separate Gateways:

Tesla Powerwall 3: The Powerwall system typically includes a Backup Gateway 2 for these functions.

SigenStor: Sigenergy’s SigenStor battery system also includes a gateway that provides intelligent energy management and monitoring, including seamless backup power switching.

Other Brands: Other brands like Sungrow also offer batteries with integrated or standalone gateways for similar functionality.

Compliance and Connection:

This will include applying for a connection offer from the local utility provider, in the Coffs Harbour region, which is Essential Energy. This application can take up to 4 weeks to be confirmed and is required before the installation can progress.

Pre-Installation Inspection :

Due to the crucial standards for installing lithium batteries, it is recommended to have a pre–site inspection before booking the installation date.

See Location and placement below for compliance standards.

At Mega Watt Power, we prefer to do this for a new customer. If you are an existing customer, we will have site images of your recent installation that we can use to verify positioning for the battery, and we will notify you if we will be visiting for the pre– installation inspection.

Installation Scheduling:

The installer must ensure the installation complies with all relevant regulations and standards, including those related to safety and connection to the grid (if applicable).

Once the connection offer has been received from the utility provider, the installation can then proceed to the next stage.

Here’s a breakdown of the crucial standards and considerations:

Clearance and Ventilation:

Minimum Clearance: A minimum of 600mm of lateral clearance (side-to-side) and 900mm of vertical clearance (above the battery) is mandated.

Heat Management: These clearances are crucial for airflow, preventing heat buildup, and minimising the risk of thermal runaway, especially with lithium-ion batteries.

Manufacturer’s Specifications: Always adhere to the specific clearance recommendations provided by the battery manufacturer.

Ideal Locations: External walls or garages are generally preferred for battery installation. if installed in the garage, a fire alarm should be installed above the battery. 

Prohibited Locations: Batteries are generally not allowed in habitable rooms (e.g., bedrooms, living rooms), ceiling spaces, or areas that could hinder evacuation or are near flammable materials.

Distance from Openings and Appliances: Avoid placing batteries near windows, doors, hot water systems, and air conditioners.

Wall Mounting: If mounting a battery on a wall where a habitable room is on the other side, a non-combustible barrier extending the clearance dimensions (600mm side, 900mm above) is required.

Batteries in garages may require bollards or other physical barriers to protect them from vehicle impact.

Installer Accreditation: Ensure your installer is CEC accredited.

Residential, CEC accredited for Hybrid battery system installations .

Off-Grid Systems, CEC accredited for Off-Grid accreditation which is a separate accreditation.

Clean Energy Council (CEC) Approval: The battery and its components should be listed on the CEC’s list of approved products.

Compliance with Standards: The installation must comply with all relevant Australian standards, as well as local, state, and federal regulations.

Certificate of Compliance: Obtain a Certificate of Compliance for Electrical Work (CCEW) from your installer as proof of proper electrical safety testing.

Post-Installation Support:

• The installer should offer support and information on how to use your battery system.
•  A user manual with all the relevant paperwork, including the CCEW, a fully paid invoice with a list of serial numbers needed for compliance with the rebate and installation, should be provided either by mail (hard copy) or email (digital copy).
• We advise our customers to make sure they contact their insurance company to notify the installation of a home battery so this can be added to the home insurance policy.
• Making sure the monitoring has been set up and any export limits have been set for the battery. This is a critical step when the customer signs up for a VVP.

Inspections for CCE (Clean Energy Council) accredited solar battery systems are conducted to ensure safety and compliance with industry standards. These inspections are a part of the Small-scale Renewable Energy Scheme (SRES) and are carried out by accredited inspectors. Systems owners won’t incur costs for these inspections, which are selected at random or when deemed necessary by the Clean Energy Regulator. 

Specific points that inspectors might check:

Safety: Ensuring the installation is safe and free from hazards.

Compliance: Verifying that the system meets all relevant standards and regulations.

Documentation: Checking for proper documentation, including the system design, installation details, and any relevant certificates.

Component Quality: Ensuring the use of approved solar batteries and inverters.

Virtual Power Plant Readiness: Confirming that the system can connect to the grid and respond to signals.

Ongoing Internet Connection: Ensuring the system has a reliable internet connection for VPP functionality. 

Key Aspects of Inspections:

Random Selection: Inspections are conducted randomly to assess compliance across various installations.

Voluntary Participation: Participation in an inspection is voluntary, and it can only proceed with the written consent of the system owner.

Installer and Designer Accreditation: Installers and designers of battery systems must hold the appropriate accreditation from Solar Accreditation.

Compliance with Standards: Inspections ensure that installations adhere to relevant laws and standards, including those related to safety and performance.

Reporting Unsafe Installations: Inspectors are responsible for reporting any unsafe installations to relevant authorities and the system owner.

Rectification of Issues: If issues are identified during the inspection, the installer will be notified and may need to rectify them within a specified time frame.

Final Inspection Reports: Detailed inspection reports are prepared and provided to the system owner, agent, installer, designer, and relevant electrical safety authorities.  

If you need more information regarding any of the items in this post please feel free to contact us at

retail@megawattpower.com.au