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Upcoming Changes to Solar Battery Installation Costs for Australians
Starting next week, Australians will have the opportunity to benefit from a new federal government initiative aimed at reducing the costs associated with solar battery installation. Many homeowners have successfully slashed their electricity expenses to zero after making this investment, though the initial financial outlay can be significant.
Anthony Barrett’s Experience
Anthony Barrett, a lighting designer from Stanmore, is one such homeowner. He and his family have eliminated electricity bills entirely, instead receiving credits as a result of their solar battery system. Over the years, Barrett has invested approximately $30,000 on solar panels, inverters, batteries, and upgrades to a heat pump and electric kitchen. He acknowledges that this was a hefty upfront investment, yet he believes the long-term savings will justify the cost.
Barrett notes that previously, his family faced energy bills ranging from $2,000 to $2,800, including both gas and electricity. Since installing two 10kWh batteries, which totalled $21,000, Barrett reports they are now “thousands ahead” with an annual earning rate of over $1,000.
To further optimise their energy savings, the Barrett family switched to a wholesale electricity provider, Amber Electric, enabling them to access wholesale electricity prices rather than fixed rates. However, this arrangement can result in price fluctuations.
Financial Calculations and Long-term Planning
Based on their current energy bill savings and estimated annual earnings of $1,600, Barrett forecasts it will take about seven years to recoup the battery installation costs. The batteries come with a warranty of 10 years; however, due to usage patterns, Barrett anticipates they will last up to 12 years. He has developed a comprehensive 24-year financial plan with his wife, accounting for expected future replacements and expenses associated with their solar system.
“It’s a long-term thing and it’s a big upfront cost too. It’s nothing to be sneezed at,” Barrett remarked, emphasising the need for careful financial consideration when entering this venture. He encourages others to thoroughly research and assess their individual circumstances before committing to a similar path.
The Cheaper Home Batteries Program
The federal government’s Cheaper Home Batteries Program launches on July 1, offering a 30% discount on the costs associated with battery installation. This $2.3 billion initiative was originally introduced during the recent election campaign and aims to facilitate greater adoption of solar battery systems among Australians.
According to a study conducted by Brighte, approximately 50% of Australians consider the upfront costs of home energy upgrades too daunting, with a significant number feeling overwhelmed by the process. The Smart Energy Council has expressed support for the new scheme, stating it could help millions of Australian households permanently reduce their energy bills.
Benefits of the Program
With around 4 million homes currently utilising solar energy, this policy aims to empower these households by enabling them to store energy for later use at lower rates. The CEO of the Smart Energy Council, John Grimes, commented that this initiative will allow Australians to take control of their energy expenses and usage.
Current Market Landscape
Presently, there are approximately 77 solar batteries available on the Australian market, with prices starting at around $4,000 for a 5kWh unit. The Smart Energy Council recommends that the suitable capacity for home batteries generally ranges from 5 to 15kWh.
Government modelling suggests that households already equipped with rooftop solar could see additional savings of up to $1,100 on their annual power bills by installing batteries, while new solar installations could yield savings of up to $2,300 per year.
However, various states have begun retracting their solar battery incentives; for instance, New South Wales has replaced its home battery rebate with a reduced incentive for virtual power plans, Victoria has terminated its interest-free solar battery loan programme, and Queensland has concluded its $4,000 battery rebate.
Conclusion
Barrett has stressed the significance of his energy savings, especially in light of rising general living costs, including insurance. “Life in general is not cheap, it’s not getting any cheaper, but the thing we don’t worry about is our electricity bill and power bill,” he shared.
As Australians gear up to take advantage of the forthcoming Cheaper Home Batteries Program, the landscape of solar energy in Australia continues to evolve, promising increased savings and greater energy independence for many.
