Should you get the solar panel rebate or the solar battery rebate?

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From July 2019 onwards, the $2,225 solar power rebate will be joined by a $4,838 solar power battery rebate. Dive into the terms and conditions however and you’ll see that it’s either-or, and you can’t combine them. That begs the question; Which one should you choose?

Tesla Solar Battery

When the Victorian government announced their plans for a battery rebate, there was a lot of excitement. A lot of people had been waiting for a battery rebate to make purchasing solar power batteries finally worth it and a $4,838 rebate certainly makes a dent in the pretty steep price of batteries. Is it enough though?

Well, kind of.

The costs of Solar batteries

A Tesla Powerwall 2, which is considered by many to be the best solar power battery system available, is not particularly cheap. According to Tesla Australia it costs around $10,000 and requires around another $2,000 for installation.

That’s a lot more expensive than even a very fancy solar power system.

A $4,838 rebate definitely knocks a big portion of that price, but you’re still left with a cost of more than $7,000.

The Tesla Powerwall 2 is one of the better solar power battery storage solutions
The Tesla Powerwall 2 is considered to be the best battery in terms of cost and quality

The cost of a solar power system

Without going into too much detail; the magic number for a solar power system is 6.6kW. By people in the industry that’s generally considered to be the system that gives you the best bang for your buck.

A high quality system of this size and depending on your situation is roughly $8,500 and for that price it’s installed and on your roof. The rebate lowers this price to $6,275.

(RELATED: Want to know out if you’re eligible for $2,225 Victorian solar power rebate? Check out our solar power rebate article that contains all the information you need. From the eligibility criteria to a quick step-by-step on how to claim the rebate.)

The cost of the two combined

Home Solar Panels

While you can get a solar power system on its own, you can’t get a solar power battery on its own. That leaves us with three combinations to choose from assuming your home is eligible for the rebate:

Upfront investment:

  • Just solar power with the rebate: $6,275
  • Solar power + battery with the solar power rebate: $18,275
  • Solar power + battery with the battery rebate: $15,665

As you can see, whatever way you choose to go, solar power batteries remain an incredibly high upfront cost.

Are these costs offset over time?

If you live the “battery life” then yes. That’s a big if, because means that your electricity consumption, when your solar power system isn’t generating power, doesn’t exceed the battery capacity of 13.5 kWh. That’s roughly what a couple of two living in an apartment consumes during a day.

By not consuming more than 13.5 kWh per day, you make sure you don’t have to buy energy back from the grid at an average of 28 cents per kWh, it also means you cycle the battery only once per day.

The more you cycle a battery, the more it degrades. Tesla gives the Powerwall 2 a usable life of 10 years if you only cycle it once per day. If you cycle it twice per day because you have a larger family for example, you’re effectively decreasing the usable life of the battery to 5 years.

That might seem scary, but depending on how you use your energy it doesn’t have to be. If you a lot of energy during the day, when your solar power system is generating power, you don’t need the battery. Doing your laundry during the day, having the dishwasher run during the day, etc. That way you only drain the battery at night.

The curve ball comes when trying to predict the future. You might live the perfect life for a battery now, but 10 years is a long time. Especially with children.

Let’s assume optimal conditions

Let’s assume you live the best possible life for a battery, getting the best possible return from your investment. In that case we’ve calculated that without any rebates you will have saved about $7,500 after 10 years.

If you chose to go with the $2,225 solar power rebate that number jumps to roughly $9,500 and if you went with the $4,838 rebate on the battery you will have saved about $12,000.

Whatever way you look at it, that’s a lot of money to be saving.

Let’s assume less than optimal conditions

That’s optimal conditions, assuming minimal wear on the battery and almost no electricity purchased from the grid. Once your life becomes a little less battery-perfect, the dial starts to move.

Say you use your battery system to cover half of your energy consumption. Which is considered to be about the average energy consumption of a family of four.

If that’s the case, your numbers start to look a little less rose coloured and drop by about $4,000 across the board, meaning that you will only have saved about $3,500 after 10 years if you didn’t use any rebates and to about $8,000 if you used the $4,838 rebate for the battery.

You might consider that to still be a healthy return, but don’t forget the $9,500 upfront costs you had to pay for a system with a battery vs just a regular solar power system.

That’s $9,500 you could’ve been used to reduce your car payments which often sit around 6% interest rates. Over 10 years that’s a cost of $7,500. In mortgage payments it will have cost nearly $6,000.

Had it just sat in your high-yield bank account doing nothing, it would’ve returned you $3,500 or in a low-risk investment fund like the ASX it would’ve returned $11,000.

Let’s look at just solar power

As we’ve seen, a 6.6 kWh system is considered to be the best bang for your buck and we know that a system like that costs roughly $8,500 and $6,275 if we apply the rebate.

With solar power a large portion of your return on investment comes from the fact that you are able to offset the costs of your own consumption with the amount of electricity you feed back into the system, so even if you only generate 25% of the energy you consume, you’ll still come out ahead.

Without the rebate for example you will have saved roughly $6,500 after 10 years, or $8,700 if you used the rebate.

While those returns are lower than that of the battery, they’re only slightly so. Especially if you take into consideration the much lower upfront cost of $6,275 vs the $9,500 for the system with the battery. Even more so if you consider the $2,225 interest free loan that the government is providing from July 2019 onwards, leaving you out of pocket only $4,050. Less than half of what a battery system would cost at nearly the same return.

Top 15 Things to Ask Before Buying Solar


Solar power batteries are the future. There’s no doubt about that. For some they already make sense right now, but unfortunately for the majority of households not just yet.

The battery rebate is a massive step in the right direction, but to be able to confidently say if solar power battery storage makes sense for you, we recommend you calculate it or have your retailer calculate it for you.

Solar power however makes sense for nearly everyone thanks to much lower upfront costs, less changes in lifestyle required and the much shorter break-even time. So whether you’re considering getting a battery in the future or skipping the battery solutions all together, you can already save on your energy bills right now.

Give us a call on 1300 765 502 or go to to see by how much.