The Victorian Government ("Vic Govt") has delivered their budget for the 2025/26 Financial Year on Tuesday 20th May 2025.
Here is what we learned from the Budget for the battery loan program and hot water rebate program.
Solar Victoria Solar Battery Loan - GONE TO THE GRAVEYARD
Introduced in the Budget 23/24, the Vic Govt introduced a new program, the Solar Battery Loan Program, providing an interest free loan of up to $8800 for customers looking to install a new battery with a solar PV system (new or existing). Applicants had to meet certain eligibility criteria including means-testing.
Once approved and the battery installed, customers then paid back the battery loan monthly over four (4) years, interest free.
With another program available for customers, solar retailers geared up for another rebate/loan program. New criteria, new system updates, new product approval listings, new conditions, new paperwork. With the prospect of additional batteries as part of the Government's original 10 year Solar Homes Program policy outline, will this be a new long term policy for increasing battery storage for Victorians? Reducing the upfront cost should significantly increase uptake and really kick off the battery storage industry.
Well when the Vic Govt Budget 23/24 papers advised they had a 2023-24 target of 4500 approved applications, the industry got excited.
Looks good right?
They fell well short.
Budget time 2024/25 rolls around, and the numbers are well short of their target, the actual number was 2036 applications in 2-023/24, 55% lower. The reasons given by the Vic Govt?
"....delays in finalising aspects of the loan agreement and the complexity of meeting responsible lending obligations..."
Client experiences went something like this:
You get your battery quote finalised, and once you choose your option, you're all excited and can't wait to get your battery installed. After all this time, you have spent days, weeks, months, years in some cases, researching your battery options and now you're ready to proceed.
You press the go button, you go apply for your battery loan, and after jumping through the many hoops of paperwork, you have finally submitted the application. This is an achievement in itself and you deserve a cold drink or cup of tea to congratulate yourself.
Sadly you don't realise it but now you'll be waiting in some cases many months to get approval.
Solar retailers are provisionally booking customers, organising stock procurement, install teams gearing up, the date of install approaches. Everyone is getting pumped.
The solar retailer goes into the Solar Vic Industry Hub portal to see where the customer status is at. The dreaded four words.
"....Customer application under review...."
Did the experience of the customer and industry improve though through 2024/25?
As we'll see in the 2025/26 Budget update, Victorians smashed this target.
The 2025/26 Budget comes around this week, the industry by this point is all set up, everyone has learnt how the program works. The speed of battery loan applications has improved, everyone is much happier after two years rolling out the program. The sighs of a solar retailer are a little less pronounced.
How many solar battery loans got approved in 2024/25?
An expected 3800 applications approved in 2024/25 - a whopping 87% increase year on year and well in excess of the 2500 target placed for the 2024/25. These numbers highlight the growing popularity of battery storage coupled with solar PV. A great outcome with Victorians out in force to take advantage of the battery loan program.
So given this great result, we're thinking there is more to come. ...Right?
Just when things are getting positive and lessons learnt and systems are set up, we get an unwelcome turd when buried within the 2025/26 Budget Papers in the Department Performance Statement, Appendix A, page. 187 says, in response to the performance measure, "Applications for the Solar Battery loans approved"
"....This performance measure is proposed to be discontinued as this program ends on 30 June 2025..."
A very disappointing read given the amount of work and time set up by the Solar Victoria team as well as industry to deliver this program for customers who really need that up front assistance to a battery to their solar PV system.
Customers who wish to still access this program can apply for the Solar Vic Battery Loan until 30th June 2025. Customer will receive the Loan and can be installed in the 2025/26 financial year, so long as the install occurs within 120 days from loan approval.
Given this impending cut off time of 30th Jun 2025, we strongly advise anyone interested to get their application into Solar Vic prior to the cut off.
Solar Victoria Hot Water Rebate - CONTINUES FOR ANOTHER YEAR
In good news however, the Solar Victoria Hot Water Rebate continues for another year into 2025/26 (until 30th June 2026).
Initially announced in the Budget 2019/20, the original 2019/20 target for hot water rebates (for eligible heat pump hot water and solar hot water products) was 6000 in that financial year. The Solar Homes Program included the hot water rebate of up to $1000 off the customer's heat pump hot water system.
With no budget allocation beyond 2024/25 (until 30th June 2025), we were all sweating if this would continue.
Thankfully it is.
The Vic Govt has even made a pains to point this out in the Budget 25/26 as a cost of living alleviation measure:
"...new funding announced as part of the 2025-26 Budget for the 'Solar Homes Program - Hot water rebates' initiative..."
A little tricky as technically it's new funding because there was no allocation beyond 2024/25, however the Program essentially rolls on from it's initial beginnings in 2019.
We're seeing Victorians take up the Hot Water Rebate in big numbers, how many are expected to take up the hot water rebate once 30th June 2025 comes upon us?
A total of 36900 applications, 37% more than what was originally forecast in 2024/25.
We'll see more and more Victorians heed the call to replace their inefficient and dirty gas and electric hot water systems with super efficient heat pump hot water systems.
Onwards for another year of heat pump hot water systems. Customers should take advantage of the hot water rebate program while it's around before that gets the chop too.
