How To Get NSW’s Virtual Power Plant Incentive
Last Updated: 4th Jul 2025
UPDATE JUNE 10th 2025: The NSW Battery rebate ended June 30th, 2025. Now it only makes sense to use the federal battery rebate. A payment for joining a Virtual Power Plant (VPP) remains, but instead of two separate payments, it will be changed to one larger payment when a VPP is first joined. You can find the latest information from the New South Wales Government here.
The NSW battery rebate was introduced in November 2024 and was meant to run for years. But, just before noon on June 10th, the state government announced the scheme was ending on June 30th. Now, only the federal battery rebate will be available in NSW.
The good news is batteries can still pay for themselves in NSW with only the federal battery rebate. If you have arranged to get a battery installed with the expectation of receiving both the federal and NSW battery rebates, it can still be worthwhile even without the NSW state incentive. The amount of the NSW rebate could vary, but was roughly $150 per kilowatt-hour (kWh) of usable storage, so losing it will add around $1,500 to the cost of a 10kWh battery.
If you have arranged a battery installation and don’t want to go ahead, you should contact your installer. But because the federal battery rebate will fall by around 10% at the end of the year, I would recommend going ahead anyway — provided it’s within your budget and won’t cause you financial hardship.
It will still be possible to receive a NSW state payment for joining a VPP. This can be combined with the federal battery rebate. It’s a single payment for batteries from 2-28kWh of capacity. Note that, because the federal battery rebate applies to batteries with a nominal capacity of 5-100kWh, it doesn’t make financial sense to install a new battery that’s under 5kWh. At the time of writing, the NSW government says the VPP payment will be from $40-$55 per kWh of usable battery capacity. For more details, skip down to “The VPP Incentive” subheading.
How Does The Incentive Work?
The VPP payment is tied in with the state’s Peak Demand Reduction Scheme (PDRS) that’s designed to reward the reduction of electricity consumption during peak periods, which is when the grid is under the most stress. When businesses install approved equipment that reduces peak grid consumption under the oversight of approved companies, these companies then create approved certificates, which are the incentive’s basis. These certificates can be created when a household joins a VPP.
Approved companies are called Accredited Certificate Suppliers (ACPs), with whom installers will need to work. The PDRS certificates (PRCs) are tradeable, with values changing according to market conditions. After any administration fees, the total value of these certificates makes up the VPP incentive.
How Much Is The Battery Rebate?
The certificates created when a home joins a VPP can vary in value. This is why the NSW government says the VPP incentive is $40-$55 per kWh rather than giving a single figure. The graph below shows how the value of PRCs can change.
PRC prices can head up or down. You can track their value on Demand Manager.
The VPP incentive requirements
There are several requirements to receive the VPP incentive:
- 2-28kWh of capacity — note the nominal capacity of a new battery must be at least 5kWh to get the federal battery rebate
- Connected to a solar system
- On-grid
For owners of existing batteries, they’ll need to use an ACP to assess eligibility and perform the sign up to a Virtual Power Plant. But if the company that installed the system works with an ACP, they may be able to assist there.
Next Steps – Start Now
If you are looking to get a home battery in NSW, simply request a battery quote. We’ll then match you to up to 3 trusted installers servicing your area who will provide you with a detailed obligation-free quote for a system that best suits your needs and circumstances.
If you need more information to determine if a home energy storage is right for you, check out our detailed guides to understanding, buying and owning a solar battery, and also our guide to Virtual Power Plants.