Australia has blazed a trail as one of the fastest-growing export markets for Chinese batteries amid a rapid shift to domestic renewable energy by one of the world’s largest fossil fuel producers.
Officials and delegates from the country were feted as big new customers on a recent tour of China’s Guangdong province, where China Southern Power Grid Technology Company showcased energy storage and grid modernisation.
Remarkably, Australia accounted for almost 10 per cent of new global battery capacity in March, with about 2,000 home batteries being installed every day this year.
David Dixon, senior analyst at consultancy Rystad Energy, said the country had been a big beneficiary of cheaper batteries from China following Beijing’s trade war with Washington. Australia is now the third-largest importer after Germany and the US, according to Rystad data.
“Australia won’t stay at number three but it has been going gangbusters,” Dixon said of the rapid rollout. “We have never seen anything of this magnitude before.”
The country of 28mn people has surpassed 2GWh of battery storage per million people, according to Rystad, which called it an “unprecedented build-out”.
The conditions for fast adoption have been set by a combination of high solar panel ownership, unreliable coal power supply and poor connectivity between states.
Battery storage allows the nation’s renewable energy, abundant at certain periods, to be stored for use at peak times when demand is high.
A total of 600,000 home batteries are now installed in Australia — more than three times the number in California — with some signs that the strain on the country’s power network has eased during times of peak demand. By 2030, the government estimates that at least 2mn new residential batteries will be installed.
Renewable sources, backed by storage, generate about half of Australia’s energy supply and batteries are increasingly setting the price of power on the country’s east coast.
The boom in household batteries follows the introduction of a A$7bn (US$4.8bn) subsidy programme last year. The take-up has been such that an adjustment was made to the rebate from May to take the steam out of the red-hot market.
Even people who do not own batteries benefit from their installation, as households that are not drawing on the grid system at peak periods keep prices lower than they would be otherwise for everyone else.
The influx of batteries has meant the cost of generating power has fallen 12 per cent in the first quarter of 2026 in Australia, which will drive a significant reduction in consumer electricity bills from this month.
The household battery surge has complemented the pace of the build-out of the utility-scale batteries behind large energy projects — such as solar or wind farms — that generate electricity directly for the power grid.
Major contracts have been awarded to companies including Brookfield’s Neoen, AGL and Origin Energy. Rystad said there were 137 utility-level projects now operating, under construction or at financial close.
Tim Buckley, director of Climate Energy Finance, who attended the China tour, said Australia’s outsized role in the global battery market made sense, given the speed at which households had taken up the subsidy, following on from solar installations.
About 4mn homes, or 40 per cent of detached houses in Australia, have solar panels that generate power during the day. The batteries can spread the use of that energy into the evening or other peak periods.
The operator of the national grid said homes with batteries had drawn 80 per cent less power from the grid compared with solar-only houses in the state of Victoria during the height of summer in January, when power demand hit an all-time record.
The federal government has also moved to press home a demand shift by forcing energy companies to offer three hours of free energy use during the day for people who have a smart meter.
Frank Calabria, chief executive of Origin, the utility company that is also one of the largest installers, said a quarter of its customers now generated their own power.
“Every home battery, every EV, every hot-water system that can shift when it draws from the grid, is a small lever on costs,” he told an audience last month. “That benefit doesn’t stop at their own bill; it lowers the cost of the whole system. Lower peaks mean a cheaper system to run.”
The government also launched pilots of vehicle-to-grid technology last month to allow households to use their electric vehicle as a battery to store solar energy.
Australia’s Labor government has set a target to source 82 per cent of the country’s energy from renewable sources by 2030, up from about half in June this year.
Buckley said the “battery boom” had made that ambitious aim more achievable, with the larger size of batteries being installed on the sides of houses helping to alleviate the amount of gas the country needs to use in the future for night-time use.
“Solar ate coal’s lunch and now batteries are eating gas’s dinner,” he said.
