As rooftop solar overtakes coal, more batteries are powering the night shift
A fourfold increase in residential battery purchases has been hailed as a transformative moment for the electricity grid, with hopes of lowering prices as more renewable energy is absorbed from solar panels to power homes after sunset.
New figures reveal Australian households purchased 183,000 battery units in the second half of 2025; This figure is four times higher than at the same time the previous year and almost equal to the total of the previous five years.
The increase, which industry leaders described as “extraordinary”, comes after the Albanian government last year offered deep discounts to anyone who bought a battery system to store energy from rooftop solar panels. Discounts save thousands of dollars in upfront costs.
Australia has long been a world leader in per capita solar energy uptake, with more than 4 million homes (or a third) equipped with rooftop solar panels. New figures from the Clean Energy Council due on Wednesday show rooftop solar has reached 28 gigawatts of capacity on the energy grid, eclipsing the capacity of the national fleet of coal-fired power plants (22.5 gigawatts).
“Our largest power plant is now on the rooftops of more than 4.3 million households, helping to increase downward pressure on electricity bills for consumers and businesses,” said Jackie Trad, managing director of the industry group.
But until recently, only one in 40 homes had a battery, which caused a problem: All those solar panels were producing a lot of electricity in the middle of the day, when the sun is brightest, and producing almost no electricity when people returned home, turned on the lights, and turned on the appliances, causing wholesale prices to soar.
Energy Minister Chris Bowen said the increased use of household batteries, many of which use lithium-ion technology like those in smartphones, cordless drills and electric cars, would allow more homes with solar panels to store free energy and use it during peak demand hours in the afternoons. This, he said, would ease pressure on the grid and limit volatile price fluctuations for all energy users.
“More Australians are taking control of their electricity bills and using their own clean, cheap energy when they need it,” Bowen said.
“Home batteries deliver real, lasting cost of living relief for Australian households, while working to make the energy grid fairer, more affordable and more reliable during times of peak demand.”
Electricity bills have risen by hundreds of dollars a year in some parts of Australia since 2022, largely due to the effects of Russia’s invasion of Ukraine driving up coal and gas prices and increasing the cost of generating electricity.
The implementation of new renewable projects and transmission lines is lagging behind the pace needed to compensate for the closure of coal-fired power plants.
But experts say there are signs that more renewable energy and battery installations are helping to suppress prices. Wholesale electricity costs – the money retailers pay for electricity before selling it to customers – fell sharply in eastern Australia in the final three months of last year as record contributions from renewables and batteries reduced the need for fossil fuel-powered generators and hydroelectric dams to fill critical supply gaps.
Tristan Edis, head of analysis at energy consultancy Green Energy Markets, said the scale of home battery installations was so significant that it could cause electricity prices to fall if the trend continues. “If the scale of installed capacity can be maintained over the next five years, the extent to which gas producers are increasing wholesale market prices should be severely reduced,” he said.
Adding batteries could reduce overall demand on the grid, but all stored energy needs to be better “regulated” to reduce the cost of the energy transition for as many people as possible, officials warn.
Australian Energy Market Operator calls on retailers to encourage greater participation in “virtual power plants”; In this way, electricity providers give bill credits to customers in exchange for being able to harvest the capacity of thousands of batteries simultaneously to address imbalances in the grid and keep the network stable.
Along with batteries, the operator says the deployment of more gas-fired generators and larger storage assets such as hydropower will also remain critical to supporting renewables, especially when wind and sunlight are long-lasting.
Even today’s most powerful grid-scale batteries consume their stored energy at two to four hours of maximum output, minimizing their ability to recover from longer-term shortages.
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Nick Toscano is an economic correspondent for The Age and the Sydney Morning Herald.Connect with: X or email.
Mike Foley is the climate and energy correspondent for The Age and The Sydney Morning Herald.Connect via email.
