Australian Greens launch plans to subsidize 1.2 million residential battery systems

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Saying that distributed battery storage "will revolutionize our energy system," the Australian Greens are looking to advance deployment through a new subsidy scheme. The Greens’ plan would subsidize a residential battery system by up to 50% and allow businesses to depreciate a system over three years, instead of the usual 15 years.

The Greens say they hope to incentivize up to 1.2 million residential battery systems over five years under the scheme.

A complimentary low-income storage (LISS) program will provide would provide grants to households with an income of less than AU$80,000 per year (US$59,000), additional to the AU$5,000 storage tax credit. The Greens plan for the Australian Renewable Energy Agency (ARENA) to administer the program and then to conduct a review of it in 2020.

The residential solar tax credits will decrease over time, alongside the LISS grant program, from AU$5,000 in the Australian financial year 2016-17, down to AU$1,500 (US$1,100) in 2020-21.

The Greens propose to fund the program through AD$2.75 billion (US$2.02 billion) in savings through the scrapping of an accelerated asset depreciation program currently in place for the purchase of new aircraft and the oil and gas industry. The Greens’ battery storage program has been calculated at costing AU$2.9 billion (US$2.13 billion) over five years.

The Greens are currently one of the opposition parties in the Australian federal parliament, and while this means the policy has a limited chance of being enacted into law, it plans to use its substantial bargaining power in the Senate to progress the policy, the Guardian Australia has reported.

“We’ll be opposing most of this budget [delivered this week be the government], which grows inequality and does nothing for clean energy, but if the government comes to us to talk about some of their less-offensive measures, we’ll want to talk to them about programs like this one,” the Greens energy spokesman, Adam Bandt, told Guardian Australia.

While the Greens have earmarked ARENA for rolling out and assess its storage incentive program, ARENA CEO Ivor Frischknecht told pv magazine that, while it would be premature to rule anything out, it would be unlikely to roll out a similar, nationwide subsidy program in its own right.

"We don’t see ARENA to contributing much, if anything, to the global cost decline of batteries," said Frischknecht. "Our volume is too small to impact on the cost of manufacturing. However, we are open minded about that, and it is something that we are thinking about actively. We are evaluating what we could do to enable the uptake of renewables in the network, and it could well be storage that could play a critical role in that. We could be looking to encourage more storage capacity."

ARENA is currently involved in a number of energy storage programs, including the Alkimos Beach suburban project in Western Australia. It has also funded a grid storage program in South Australia, which involves a truck on which a storage system is mounted evaluating the impact of utility scale storage at various points on the grid, and lithium ion technology research center.

While the current Federal Government has not been particularly supportive of renewable energy, it has show signs of being broadly supportive of storage subsidies.