Since 1 May 2026 the Cheaper Home Batteries Program no longer pays the same certificate rate on every kilowatt-hour. The first 14 kWh of usable capacity still earns STCs at the full factor. The next 14 kWh earns 60 per cent of it, and the band from 28 to 50 kWh earns just 15 per cent. Past 50 kWh there is nothing.
For most homes that changes the maths of “bigger is better” quite sharply. A 13.5 kWh battery sits entirely inside the top band, so it feels no change at all. A 30 kWh system for a large home or a small business picks up discount at a fraction of the old rate on everything past 14 kWh.
The structure in one table
Usable capacity is the figure the manufacturer publishes for the energy you can actually draw out, not the nameplate or gross number. The program counts it in whole kilowatt-hours across three bands.
| Band (usable kWh) | Share of the factor counted | At a factor of 6.8 |
|---|---|---|
| First 14 kWh (0 to 14) | 100% | 6.8 STCs per kWh |
| Next 14 kWh (14 to 28) | 60% | 4.08 STCs per kWh |
| Next 22 kWh (28 to 50) | 15% | 1.02 STCs per kWh |
| Above 50 kWh | 0% | none |
The factor itself steps down every six months: 6.8 from May to December 2026, 5.7 from 1 January 2027, 5.2 from 1 July 2027, and on down towards 2030. The tiers apply on top of that. If you want the factor schedule on its own, our battery STC factor answer lays it out.
Worked examples at a factor of 6.8
The calculation is simple once you split the battery across the bands. Take a 20 kWh battery:
- First 14 kWh: 14 x 6.8 = 95.2
- Next 6 kWh: 6 x 6.8 x 0.60 = 24.48
- Total: 119.68, which rounds down to 119 STCs
At an STC price of $38, that is about $4,522. The table below runs the same sums for common sizes. All figures are illustrations; certificates are rounded down and the spot price moves.
| Usable kWh | STCs | Value at $38 | Value per kWh |
|---|---|---|---|
| 5 | 34 | $1,292 | $258 |
| 10 | 68 | $2,584 | $258 |
| 13.5 | 91 | $3,458 | $256 |
| 14 | 95 | $3,610 | $258 |
| 20 | 119 | $4,522 | $226 |
| 28 | 152 | $5,776 | $206 |
| 40 | 164 | $6,232 | $156 |
| 50 | 174 | $6,612 | $132 |
The last column is the useful one. Going from 14 to 28 kWh doubles the battery and adds about $2,150 of discount. Going from 28 to 50 kWh nearly doubles it again and adds only about $840. The marginal return falls away quickly.
You can run your own numbers in the battery STC calculator.
Why the government did it
The reported reason is budget control. Demand for the program ran well above early forecasts, and the budget was expanded from $2.3bn to $7.2bn as reported. Tiering concentrates support on household-sized batteries, which are the bulk of installs, and trims the cost of very large systems that were claiming a generous discount per kWh.
That is a policy judgement and not ours to grade. What matters for a quote is that the sums now reward right-sizing.
What this means when you size a battery
A few practical points follow from the table.
Size to the household, not the rebate. A typical home using 15 to 20 kWh a day, with solar, usually finds that 10 to 15 kWh covers the evening and overnight load. That falls in the full-rate band. Chasing a 28 kWh battery to “get more rebate” now earns only 1.02 to 4.08 STCs per extra kWh (roughly $39 to $155 at $38) against an installed cost that is far higher.
Two smaller batteries do not help. The program allows one battery per property, and the bands are calculated on total usable capacity, so splitting a system across two units does not reset the tiers.
Business sites feel it most. A small business with a 30 to 40 kWh requirement gets the full rate on the first 14 kWh and a thin discount after that. Check the commercial position against the NSW commercial incentive reported from 1 September 2026, and see the state scheme guide for where else stacking might apply.
Usable capacity is what counts. Two batteries with the same headline kWh can have different usable capacity. A product with 13.5 kWh usable earns more than one marketed as 14 kWh with 12.8 kWh usable. Read the datasheet figure, which is also what the CEC-approved listing is based on.
Timing on top of tiers
The tiers did not change the 1 January 2027 step. The factor falls from 6.8 to 5.7, about 16 per cent, so a 13.5 kWh battery that creates 91 STCs now creates 76 then (13.5 x 5.7 = 76.95, rounded down). If you are deciding whether to move before the end of the year, should you buy a battery before 1 January works through the decision. The installer-side view of the program is in the installer guide.
For installers: where tier errors turn up
Installers carry the discount on the quote and wait for the certificates, so a tier error is a margin error. The usual ones:
- Using nameplate kWh instead of usable kWh in the calculator.
- Applying 100% to the full capacity of a battery over 14 kWh.
- Quoting at the factor in force on the contract date rather than the installation date.
- Forgetting that certificates round down per system, not per band.
Build the tiered calculation into your quoting template, and check the model’s usable figure against the approved product listing. The 14, 28 and 50 kWh tiers answer is a handy reference for the crew. For the paperwork side, the battery submission guide lists what the claim needs.
Questions installers ask about the bands
Do the bands apply per module or per system? Per system. Usable capacity is totalled across the installed battery, so three 5 kWh modules form a 15 kWh system. That earns 14 x 6.8 = 95.2 plus 1 x 6.8 x 0.60 = 4.08, a total of 99.28, which rounds down to 99 STCs. Compare that with a 13.5 kWh battery at 91 STCs. The extra 1.5 kWh adds 8 certificates, about $304 at $38, and costs more than that in hardware.
Can a customer top up later? The program allows one battery per property, so a second claim for added capacity is not available. If a customer might want 20 kWh in three years, quote that system now and explain the band maths, because later is not an option for certificates.
Does the tier apply to the factor step in January? Yes, the same three bands apply at 5.7 and 5.2, just at lower factors. A 20 kWh battery creates about 100 STCs at 5.7 and 91 at 5.2. See the related answer on the battery STC factor in 2027.
What about batteries over 50 kWh? Capacity from 50 to 100 kWh can be eligible for the program but earns no certificates beyond the 50 kWh counted, so large commercial batteries should be priced with that in mind.
What to do next
- Find the usable capacity on the datasheet of the battery you are quoting.
- Run it through the three bands at the factor in force on the installation date.
- Compare the value per kWh across two or three sizes before choosing.
- If you are an installer, see the battery STCs page and check the current rate on the pricing page.
- When you are ready to lodge battery claims, start trading.