Is a solar battery worth it for your Melbourne home?

The short answer for a Melbourne home

On solar, a battery saves money one way: it keeps solar you would otherwise export and gives it back after dark. Each kWh it moves saves your usage rate instead of earning your feed-in tariff. On the Victorian Default Offer flat rate in the United Energy area that is 27.35c saved against an example feed-in tariff of 3c. Solar Victoria says homes with solar panels alone use around 25% of the solar they make, and homes with a battery around 50 to 60%.

• Most likely to pay: you use 10 kWh or more after dark and your solar has that much to spare. Our example home pays back in about 9.5 years, and a bigger home with a 20 kWh battery in about 9 years.
• Borderline: your feed-in tariff is generous or your usage rate is low. At a 6c feed-in tariff the example home takes about 10.5 years, past a 10-year warranty.
• Not yet: the house is quiet after dark (about 18 years), or the battery is bigger than your evening use (about 15.5 years).

Time-of-use pricing, Victoria’s free midday hours and blackout backup can each tip a borderline home into worth it. The rest of this page shows the numbers behind each case.

How long does a solar battery take to pay back?

Payback is the battery’s price after the federal rebate ÷ what it saves each year. The table works it out for four homes with the model behind our solar calculator, the Victorian Default Offer flat rate in the United Energy area (27.35c) and an example feed-in tariff of 3c.

Two things stand out. Size the battery to your evening use: the example home with 20 kWh instead of 10 stores only 540 kWh more a year, because it uses 12 kWh after dark, so the payback grows from about 9.5 years to about 15.5 years. Evening use drives everything: the quiet home’s battery stores 1,750 kWh a year, about half what the example home’s does.

The index’s prices carry the rebate for installs in May–December 2026 (a factor of 6.8). From 1 January 2027 the factor falls to 5.7: if prices before the rebate don’t change, a 10 kWh battery then costs about $400 more after the rebate (at $38/STC), and the example home’s payback stretches to about 10 years.

These paybacks lean short. The model counts no charging or discharging losses, and the makers in our comparison promise only 70% of a battery’s capacity at 10 years, so it stores a little less each year.

Battery payback calculator

Put in your own use, solar, battery and rates. It runs the same model as the table and shows whether the battery pays for itself within a 10-year warranty.

Battery prices and the rebate by size

When does a battery pay for itself?

Four things decide it, roughly in this order.

You use power after dark

A battery only saves on what you use between sunset and sunrise: cooking, lights, heating or cooling, the TV, hot water on a timer. A home that uses 12 kWh after dark can empty a 10 kWh battery every night; a home that uses 4.8 kWh can’t. Your smart meter data shows the split (see the mistakes below).

Your tariff

The higher the price of the power a battery replaces, the faster it pays. On a time-of-use plan, power used in the 4 pm to 9 pm peak costs the most, and that is when a battery runs your home:

If every kWh the example home’s battery stores replaced peak power, it would pay back in about 6 years instead of about 9.5 years. That is the best case: only evening use before 9 pm gets the peak rate, and power used overnight is off-peak.

Your feed-in tariff

Victoria has had no minimum feed-in tariff since 1 July 2025: your retailer sets the rate, and it can’t go below zero. The lower it is, the less you give up by storing solar. For the example home the payback is about 8.5 years at 0c and about 10.5 years at 6c.

Export limits and spare solar

Each network caps how much solar a home can export, and CitiPower, Powercor and United Energy plan to lower the fixed limit. Solar above your limit is lost on sunny middays unless you use it or store it, and each kWh a battery saves that way is worth your full usage rate. The other side: a battery needs spare solar to fill it, which a small system doesn’t have (see a battery or more panels).

Export limits by network

When a battery doesn’t pay yet

To put it plainly: on today’s flat rates, these homes won’t get their money back within a 10-year warranty from the bill alone.

• The house is quiet after dark. Using 60% of its power in the day, the quiet home’s 10 kWh battery takes about 18 years.
• The battery is bigger than your evening use. The rebate pays its full rate only on the first 14 kWh, and spare capacity sits empty: about 15.5 years for 20 kWh on the example home.
• The solar is too small to fill it. On 3 kW of solar the example home’s 10 kWh battery saves only $350 a year: about 22.5 years.
• Your rate is low or your feed-in tariff high. Each cent between the two is what a stored kWh is worth; at a 6c feed-in tariff the example home takes about 10.5 years.

A battery can still make sense for these homes for blackout backup, or once the house uses more power at night. On the bill alone, adding panels first, changing plans or waiting until your evening use grows is the better money.

Size a battery to your evening use

How free midday power and VPPs change the maths

Since 1 October 2026, households with a smart meter can ask their retailer for Victoria’s Midday Power Saver: free electricity from 11 am to 2 pm, up to 24 kWh a day. Its pricing order has no separate rule for batteries: charging counts like any other use. The Victorian Government says you can charge a battery in the window and use the stored power later, when prices are higher.

That changes a battery’s maths in two ways. A kWh charged free at midday and used in the 4 pm to 9 pm peak avoids up to 42.45c in the United Energy area (the plan’s maximum peak rate there), against 24.35c for solar stored on the flat rate. And in winter, when solar can’t fill the battery, the free hours can: the example home’s 6.6 kW of solar has only about 8.5 kWh a day to spare on an average winter day, and its 10 kWh battery covers 66% of its evening use in winter, against 83% in summer.

The catch: rates outside the free hours can be up to 2.18c a kWh higher than the Victorian Default Offer’s time-of-use rates, and solar you use from 11 am to 2 pm replaces power that would have been free anyway. Compare your plan on Victorian Energy Compare before you switch.

How the free hours work

Virtual power plants

A virtual power plant (VPP) lets an operator use part of many home batteries at once. For the federal rebate a grid-connected battery and its inverter must be able to join one, but joining is your choice, now or later. What an offer pays, and how much of your battery it uses, differ by offer, so none of it is in the paybacks on this page. Weigh an offer against what the battery saves you on its own.

How a VPP works with your battery

Blackout protection: value you can’t put on a bill

None of the paybacks above counts anything for backup. A grid-connected battery keeps the lights on in a blackout only if the inverter has a backup output and the circuits you want kept on are wired to it; without that it shuts down with the grid. How much charge is left when a blackout starts depends on the time of day.

Backup also differs by battery. Of the eight home batteries in our battery comparison, the makers of two state whole-home backup and one states it with some of its inverters; the other makers’ documents don’t state whole-home backup. If an outage would cost you, such as a home office or a full freezer, that cover is part of what a battery is worth and can justify one the bill alone doesn’t. The battery size calculator sizes a battery for the load you want to keep on and for how long.

How home battery backup works

Mistakes people make buying a battery

• Buying more battery than you use after dark. The federal rebate pays its full rate on the first 14 kWh, 60% from 14 to 28 kWh and 15% from 28 to 50 kWh, and capacity you never use earns nothing.
• Expecting it to fill in winter. Melbourne’s June solar is about 41% of January’s, so our example home’s battery covers 66% of its evening use in winter (season by season; winter and backup).
• Comparing the wrong capacity. The Clean Energy Regulator defines nominal capacity as the maximum amount of energy a battery can store at full charge, usually the figure on the product label, and usable capacity as the amount of energy that can be discharged, which is what your home can draw from the battery. Compare prices per usable kWh.
• Mixing up kW and kWh. Power (kW) limits what can run at once; energy (kWh) how long it runs (kW vs kWh explained).
• Assuming backup comes with it. It needs a backup-capable inverter and a backup circuit; ask which circuits stay on.
• Missing the rebate. The battery must be a new battery on the Clean Energy Council approved battery list, and installed by a Solar Accreditation Australia (SAA) accredited installer with battery endorsement. Ask for both in writing.
• Thinking you must join a VPP for the rebate. The battery must be able to join one; joining is your choice (the VPP rule).
• Planning to add rebated modules later. Capacity added later gets the rebate only if the first battery never claimed it, so size it right the first time.
• Sizing from a guess. AusNet says its smart meters record use every 5 or 30 minutes, and the Essential Services Commission says your distributor can give you the data. It shows what you really use after dark.
• Comparing quotes that leave things out. A lower price without the switchboard work or the backup circuit can cost more later.
• Choosing on price alone. Six of the eight warranties we compared cap the energy or cycles they cover; approved-list listings expire (the BYD HVM’s BAT-451 runs to 5 December 2026); and ask who handles a warranty claim (support in Australia).
• Ignoring your plan. The same battery saves more on a time-of-use plan or with free midday hours, so check your plan when you add one.

What a battery quote should include

A battery or more panels?

They solve different problems. More panels make more solar, but once your daytime use is covered the extra goes out at your feed-in tariff. A battery makes solar you already export worth your usage rate, but only if there is spare solar to fill it. Here is the example home with different solar sizes:

With 3 kW the battery rarely fills, so panels come first. From about 7 kW it is the other way round: going from 7 to 10 kW adds only $130 a year for this home, mostly exports, for about $2,430 more as a new system (Melbourne averages, Solar Choice Price Index, October 2026: market data, not our price). That extra pays back in about 19 years. The battery on 7 kW adds $850 a year and pays back in about 9 years. Try your own home in the solar calculator.

Is solar worth it in Melbourne?

Are batteries worth it: your questions