Government-backed community battery rollout is way behind schedule, with only a quarter built on time

Federal government-funded community batteries are being rolled out much more slowly than promised, with installs sitting at just a quarter the number supposed to be running today, according to an update from the Australian Renewable Energy Agency (Arena).

Winners of Arena’s first community battery grants only managed to build 22 of the 92 community batteries promised by the end of last year, says Data Report 1 which checks the progress of the first round. 

In 2024, ARENA awarded $125 million to 318 community battery projects around the country, and it’s in the process of divvying up a second round of $46 million. 

The report surveyed 13 of the proponents behind 284 of those initial projects and uncovered serious delays, albeit delays that should be rectified in the next 18 months. 

Of the 284 projects, 227 are supposed to be ready and running by the end of 2026 and all by the end of next year.

The proponents facing the biggest problems in delivering their first battery are SA Power Networks, Endeavour Energy, Horizon Power, Tasmanian Networks, Western Power, and Transport for NSW, the report says.  

Only Energy Queensland has been quicker than planned at bringing their first community battery online, which is expected in July.

The delays are proving to be expensive. 

“$480 million in capital expenditure is expected over the timeline of the project. This figure has increased since last reporting period from $419 million due to larger survey response rates and proponents firming up the budget of their project,” the report says. 

The federal government’s backing of community batteries has been sharply criticised for being far more costly to deliver than batteries installed behind the meter in homes and businesses – costs that wind up biting consumers through higher bills.

In March, the auditor general found that community batteries that won grants through the federal Department of Climate Change, Energy, the Environment and Water (DCCEEW) were costing on average $1586 per kilowatt-hour (kWh), a significant impost given networks are supposed to be able to deliver bigger batteries more cheaply.

In April, Ausgrid’s Rob Amphlett-Lewis said costs have since come down significantly, with the network now able to deliver these batteries for less than $25/kWh.

Ausgrid, which is the only network to still be currently developing battery projects rather than simply hosting them, is ratcheting up its battery portfolio from 16 to 46 in the next 18 months and will account for 82 per cent of ARENA’s community battery portfolio by 2028. 

“We can also see that the total number of batteries expected to be installed by 31/12/27 has increased. This is primarily due to Ausgrid’s effort to increase their planned battery installs,” the report says. 

The first look at how the Arena community battery portfolio is going also uncovered some differences between how smaller and larger projects are performing. 

The 4 megawatt (MW) and smaller projects appear to have more problems with voltage management. 

“Some batteries are charging when voltage is low and discharging when voltage is high. This indicates some batteries are struggling with voltage management. However, other batteries have a flatter voltage profile and are demonstrating good voltage management,” the report says. 

“Batteries are often discharging during the morning and evening peaks and are charging during the middle of the day. There is some level of overnight battery operation.”

Bigger batteries are working less in the morning and overnight, and discharging more during the afternoon peak. 

“The bigger batteries have a flatter voltage profile. This indicates these bigger batteries are currently doing a better job at voltage management.”

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