Solar battery rebate NSW
with VPP connection

The NSW VPP rebate is available to all households and businesses that connect a battery to a Virtual Power Plant.

The original state-run solar battery rebate in NSW is currently suspended while the the more generous, nationwide home battery rebate is available.

The new Australian battery rebate is set to run until 2030 and provides greater savings than the initial NSW subsidy. New South Wales residents are far better off with the national battery scheme and VPP incentive.

Rebates like the federal and NSW government VPP battery incentives, firmly put the economics in favour of installing a solar battery. As well as helping to reduce your electricity bills, battery storage has many other potential benefits, like:

• Ability to provide power during a blackout
• Reduce reliance on grid electricity
• Reduce your carbon footprint by using more solar energy
• Provide protection against dwindling solar feed-in tariffs
• Save money on your electricity bills

Our guide explains everything there is to know about the solar battery VPP rebate in NSW including: eligibility, how it works, how to apply, its impact on battery prices and what you can expect to save.

What is the NSW solar battery VPP incentive?

The NSW government’s solar battery VPP incentive is part of the Peak Demand Reduction Scheme (PDRS), which aims to reduce energy usage during hours of peak electricity demand. The incentive is a one-off payment for connecting a battery to a VPP.

The NSW government is also promoting the opportunity to receive ongoing payments through a VPP provider, for selling excess energy to the grid - much in the same way that solar feed-in tariffs work.

A VPP is a series of battery systems connected to the same energy sharing network. The connected batteries are controlled by a VPP aggregator using smart software and they operate like an independent power plant.

The VPP rebate can be claimed in addition to the Australian solar battery rebate.

Value of the NSW VPP rebate

The exact value of the NSW VPP rebate varies according to battery size and the VPP provider. Typically, the VPP rebate falls into the following range:

• Between $400 - $550 for a 10 kWh battery
• Between $1,000 - $1,500 for a 27 kWh battery

When combined with the federal government battery subsidy, it is possible to claim rebates totalling up to $3,910 for a 10 kWh battery and up to $10,572 for a 27 kWh battery under the NSW battery scheme.

To get an exact figure, you'll need to contact a VPP provider who registered as part of the NSW scheme.

NSW VPP providers

The NSW government recommends contacting multiple VPP providers to get a quote for the VPP incentive and understand the conditions of the contract.

It may be that you need to switch electricity retailers to access a VPP rebate. The table below shows the VPP providers registered to provide incentives:

Eligibility criteria for the VPP rebate in NSW

The eligibility requirements to claim the NSW VPP battery rebate are fairly straightforward, there is no limiting criteria based on income like there is with the Victorian solar rebate. The eligibility guidelines are as follows:

• You must be a New South Wales resident
• You must already have a solar battery installed in NSW
• Battery must have a minimum of 6 years left on its warranty
• The battery size must be between 2 kWh and 28 kWh
• The install must be connected to the electricity grid (no off-grid systems)
• An accredited supplier must connect the battery to a VPP

How to apply for the battery rebate?

Applying for the VPP rebate in NSW is relatively straightforward. We list the steps involved to access both the VPP rebate.

1. Install your battery

Once your solar battery is installed, you can then go ahead and apply for the VPP rebate.

2. Organise quotes from VPP providers

We recommend getting quotes from at least three VPP providers. Don't just look at the amount of the VPP incentive, also consider the conditions of the contract and accompanying electricity rates.

3. Select your VPP provider

Select your preferred VPP provider.

4. Sign the nomination form

Your chosen VPP provider will ask you to sign a contract before providing you with a nomination form for the VPP rebate. The contract will outline the amount of your incentive.

5. Receiving the rebate

Once the mandatory cooling off period concludes, your VPP provider will ask you to complete an online form to receive your rebate.

The VPP rebate reduces battery prices

The NSW VPP rebate further reduces the prices of solar batteries according to their size. Let’s take a look at how this impacts the price of popular battery models in Parramatta, the heart of Sydney:

The federal battery rebate along with the VPP incentive brings down the 10 kWh solar battery price to around $8,350. For a larger battery like Tesla's Powerwall 3, the price comes down closer to the $911 per kWh mark.

Combining new solar panels (6.6kW) with a 13.5 kWh battery will see you pay around $16,364. The federal incentive, the solar panel rebate which is available to NSW residents, is factored into this price.

Does the VPP rebate impact payback times?

Solar batteries save money by using stored energy rather than buying it from the grid. If you connected to a VPP, you can put your battery storage in the hands of your provider who may be able to pay a premium rate for your solar energy. NSW feed-in tariffs average around the 7c / kWh mark, so storing excess solar using a battery can save you around 29c / kWh. Rather than paying 36c / kWh for the electricity from the grid.

The NSW VPP battery incentive reduces the payback time of new panel and battery systems by providing an upfront rebate and via ongoing payments for selling excess energy. We have run the figures to see what impact the federal battery rebate has on savings and payback figures for a Sydney household.

For this exercise, we will use the average electricity bill in Sydney of $636 per quarter, a 6.6kW panel system and a 10 kWh battery.

The results show the rebate drops the payback time from right on 8 years down to 6.3 years. This more than tips the balance on the system as the payback is well inside the warranty length of the battery (10 years). Of course, the battery only makes up half of the system, the new solar panels, are expected to last 25 years.

Adding the VPP rebate

The results factor in the NSW VPP rebate as an upfront reduction in the cost of the battery.

*These figures use average data, it really is best if you perform your own calculations using our solar and battery calculator.

With the generous government incentives available, it appears the time to purchase a solar battery in NSW has arrived.