The Cheaper Home Batteries scheme has seen meteoric uptake in its first six months, with 200,000 installations since it was inaugurated on July 1 last year.
This amounts to 4.7GWhs of battery storage capacity installed across households and small businesses, with the Federal Government targeting two million installations by 2030.
And the day-to-day price benefits are already being realised, as explained by Penrith Solar Centre (PSC) founder and managing director Jake Warner.
“We’re seeing the grid become increasingly stable since the deployment of these decentralised home batteries,” he told reporters on Saturday. “That is evident with wholesale energy prices over the last couple of weeks, and events that we’ve seen over a typical Christmas period.
“So we’re seeing these batteries work. We’re seeing everyday Australians have incredible results. We’re seeing power slashed to, in some cases, zero.”
In announcing a $4.9 billion expansion to the Cheaper Home Batteries scheme in December, Federal Climate Change and Energy Minister Chris Bowen said data from the Australian Energy Market Commission indicated bills could decrease by 3 per cent across the energy system through increased home battery uptake.
Households can leverage stored energy to power their home during evening peaks rather than relying on coal-fired electricity when it’s most expensive.
According to Skip Bowman, author of monthly energy transition newsletter, In the Dark, “self-consumption is the exit”.
He observed prices during South Australia’s recent heatwave, where despite whole electricity prices going negative during the day on Wednesday January 7 due to an influx of renewable energy, at 7:50pm that night, the spot price in the state soared above $1000/MWh.
“Grid-scale batteries are faster than gas, cleaner than gas, and perfectly forecastable,” he said. “In theory, they should smooth the ramp from solar abundance to evening scarcity. In practice, they did what the market trained them to do. They waited.
“They didn’t discharge early to flatten risk. They conserved capacity for the moment when households had no choice but to pay.”
Bowman provided more colour.
“On Tuesday, wholesale prices went negative in the middle of the day,” he said. “On Wednesday, Thursday, and Friday, solar flooded the grid while demand was manageable. For most of the heatwave, electricity was cheap or free. The expensive hours were a brief, predictable window each evening.
“But households don’t see that. They pay 40 cents at noon when power costs nothing. They pay 40 cents at 7pm when power costs a dollar. The retailer pockets the difference both ways.”
While wholesale prices surge up and down depending on generation throughout the day, retailers smooth prices to “shield” consumers from the spikes.
Pricing volatility might disappear for households, but they don’t benefit from the energy abundance created during periods of the day.
Self-consumption is the best form of energy self-determination, Bowman argues.
“Self-consumption doesn’t just lower your bills, it removes you from the game,” he said. “You capture the midday abundance that retailers would otherwise arbitrage away. You use power when it costs nothing – and the margin disappears.”
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