The battery rebate drops on 1 January 2027. Here's why going bigger now pays

If you've been thinking about a home battery, the calendar matters more than usual right now. On 1 January 2027 the federal battery discount gets smaller, and it keeps shrinking every six months after that. Here's what's changing, what it's worth in real dollars, and why we're telling NSW and Queensland homeowners to think about the right size battery now rather than a small one now and more later.

How the battery rebate works

The rebate comes from the federal Cheaper Home Batteries Program, which started on 1 July 2025. It's run through the Small scale Renewable Energy Scheme, the same scheme behind rooftop solar rebates. When an eligible battery is installed, it creates small scale technology certificates, or STCs, and your installer takes their value off your price. The government says the program is designed to equal roughly a 30% discount on the upfront cost of a battery (energy.gov.au).

The number of STCs depends on two things: the usable capacity of your battery in kWh, and the "STC factor" that applies on the date it's installed.

What changes on 1 January 2027

According to the Clean Energy Regulator, the STC factor is:

• 6.8 STCs per kWh from May to December 2026
• 5.7 STCs per kWh from January to June 2027
• 5.2 STCs per kWh from July to December 2027

It keeps falling twice a year until it reaches 2.1 in the second half of 2030. The government changed it from a yearly step down to twice yearly in amendments registered in February 2026, so it lines up more closely with falling battery prices (Explanatory Statement, F2026L00093).

Since 1 May 2026 the rebate also tapers with size (DCCEEW):

• The first 14 kWh of usable capacity gets the full factor
• Each kWh from 14 to 28 gets 60% of the factor
• Each kWh from 28 to 50 gets 15% of the factor
• Nothing above 50 kWh is eligible

STCs are rounded down to a whole number.

What it's worth in dollars

STCs are traded on an open market, and the STC Clearing House buys them at a fixed $40, which works as a ceiling. In late October 2026 STCs were trading at around $38 to $40 (Energy Merchants, Demand Manager). Prices move, so treat the dollar figures below as a guide only.

Here's how the STC count works out using the CER rules:

• 14 kWh battery: 95 STCs installed in 2026, 79 STCs from January 2027. That's 16 fewer certificates, or roughly $600 to $640.
• 28 kWh battery: 152 STCs in 2026, 127 STCs from January 2027. That's 25 fewer, or roughly $950 to $1,000.
• 36 kWh battery: 160 STCs in 2026, 134 STCs from January 2027. That's 26 fewer, or roughly $990 to $1,040.

Wait until the July 2027 step and the gap gets wider again.

Why go bigger now instead of adding later

Stackable batteries like the SAJ EK70 are designed so you can add modules later, and that flexibility is genuinely useful. The catch is the rebate. The STC factor is set by the date each part of the system is installed and certified, so capacity you add in 2028 is claimed at the 2028 rate, not today's.

There are a few other reasons we like sizing it right from day one:

• Install once. One visit, one set of approvals, one commissioning. Adding modules later usually means another call out.
• Your usage only goes one way. Most households we talk to are adding an EV, a heat pump hot water system, induction cooking or a pool pump. Each one pushes up your evening load, which is exactly what a battery covers.
• The middle tier is still strong. Capacity between 14 and 28 kWh still earns 60% of the factor. Above 28 kWh the support drops to 15%, so the sweet spot for many homes sits somewhere between 14 and 28 kWh, depending on usage.
• Blackout cover. A bigger battery keeps the essentials running longer when storms take the grid down. The EK70 offers 63A whole home backup with switching in 10 ms or less.

None of this means everyone needs a huge battery. It means the right size for your home is cheaper this year than next year. A battery that's too big for your usage won't pay itself back, rebate or not.

What about state incentives in NSW and QLD?

NSW: The Peak Demand Reduction Scheme has been reshaped since the federal program started. From 1 July 2026, NSW expanded its incentives for joining a virtual power plant, and new battery activities for apartments and businesses began on 1 September 2026 (NSW Climate and Energy Action). IPART confirms the federal and PDRS incentives can both be claimed when each scheme's requirements are met. Ask us whether a VPP incentive applies to your system.

Queensland: Queensland's Battery Booster program has closed, so Queensland homeowners rely on the federal discount. The good news is it applies in full everywhere in Australia.

What could you save on bills?

The federal government's explanatory statement cites Australian Energy Market Commission findings that a household with a 10 kW solar system can typically save around $1,000 a year, and adding a 15 kWh battery can save around $600 more. Households with an EV save more again. Your result depends on your tariff, usage and roof, which is why we design every system around your actual bills.

Timing is tighter than it looks

The rebate is locked in by the install date, not the date you sign. December is a busy month for installers, network approvals and supply, and Christmas shutdowns cut into it. If you want the 2026 rate, the time to book is now, not mid December.

Lock in your price with Sungen

Sungen is an SAJ partner installer based in Macquarie Park, and we also install Sigenergy and GoodWe systems. We'll look at your bills, size a battery that actually suits your home, and show you the rebate in black and white.

Try our savings calculator or book a free quote today. Call us on 1300 585 077 and we'll get you booked in before the rebate drops.

Lock in your price. Book now.