Federal Battery Rebate Changes: What South Australian Households Need to Know

Chris Bowen announced the changes to the federal cheaper home batteries program, making larger batteries less affordable from May 2026

The Federal Government has announced major updates to the Cheaper Home Batteries Program, expanding the budget and tightening the rules to ensure the rebate lasts until 2030. These changes will affect how much homeowners can claim — especially those considering larger battery systems.

Twilight Energy has broken down the updates so you can make an informed decision about the best time and size for your home battery installation.

A Bigger Budget, But Stricter Rules

The program’s original $2.3 billion allocation has now been boosted to $7.2 billion over four years. This expansion is expected to help more than two million Australians install a home battery by 2030, doubling the initial forecast and adding 40 GWh of national energy storage.

However, the government is also tightening the scheme to prevent the rebate from being drained too quickly.

Why the Rebate Is Being Overhauled

When the program launched, the government didn’t anticipate how many households would install large batteries. Average system sizes jumped from 10–12 kWh to around 28 kWh, rapidly consuming the rebate budget.

Independent analysis showed the original funding was on track to run out by mid‑2026, instead of lasting four years.

To keep the program sustainable — and to encourage right‑sized batteries that support both households and the grid — the government is introducing a new tiered structure and faster rebate reductions.

Faster, Steeper Rebate Reductions

The rebate is delivered through Small‑scale Technology Certificates (STCs). From May 2026, the STC factor will:

• Decline every six months (instead of annually)

• Reduce more sharply to reflect falling battery prices

Estimated rebate value per kWh

Period	Rebate per kWh
Rest of 2025	$372
Jan–Apr 2026	$336
May–Dec 2026	$272
Jan–Jun 2027	$228
Jul–Dec 2027	$208
Jan–Jun 2028	$184
Jul–Dec 2028	$164
Jan–Jun 2029	$144
Jul–Dec 2029	$124
Jan–Jun 2030	$104
Jul–Dec 2030	$84

These reductions apply to batteries installed from May 1, 2026.

New Tiered Rebate for Larger Batteries

To prevent oversized systems from consuming the bulk of the rebate, the government is introducing a tiered structure based on usable capacity:

• 0–14 kWh: 100% of the STC factor

• 14–28 kWh: 60% of the STC factor

• 28–50 kWh: 15% of the STC factor

Systems up to 100 kWh remain eligible, but STCs will only apply to the first 50 kWh.

Adam, from Bedford park, had a Twilight SigEnergy battery installed in December before the rebate declines for larger systems.

This is a major shift — and it heavily favours small to medium‑sized batteries.

What This Means for South Australian Homeowners

Twilight Energy’s takeaway is simple:

• Smaller batteries (10–14 kWh) become the best value under the new rules.

• Large batteries (20–50 kWh) lose a significant portion of the rebate from May 2026.

• If you’re considering a larger system, installing before May 2026 could save thousands.

• The updated structure ensures the rebate lasts until 2030, giving households more certainty.

Twilight Energy’s Recommendation

If you’re planning a battery installation in South Australia, now is the ideal time to review your options. With the rebate tightening and battery prices continuing to fall, choosing the right size is more important than ever.

Twilight Energy specialises in helping homeowners select a battery that:

• Maximises bill savings

• Supports solar self‑consumption

• Aligns with the new rebate tiers

• Future‑proofs your home for EV charging and VPP participation