Home batteries generate two-thirds of Australia's A$7.7 billion smart home revenue
Home batteries now make up two-thirds of Australian smart home revenue in a market that reached A$7.7 billion in 2025, Telsyte reports. It credits the federal rebate and a cost-of-living squeeze, and expects the battery share to peak this year and ease to just over half by 2029.
The Board Room · Leadership desk
Smart battery revenue grew 396% year on year in 2025, while the rest of the smart home market, with batteries stripped out, grew 19%. More than 507,000 batteries had been installed under the Cheaper Home Batteries Program, as announced in August.
| Figure | Value | Note | Claim |
|---|---|---|---|
| Smart battery revenue growth, 2025, year on year | 396% | 3 | |
| Rest of market, 2025 | 19% growth | 8 | |
| Batteries installed, over | 507,000 batteries | 5 |
What happened
- The Telsyte study, released on 12 October, projects the market will top A$11 billion this year, after it more than doubled in 2025.
- The Cheaper Home Batteries Program began in July 2025, and battery revenue for that year was up 396% on 2024.
- In August the Prime Minister and the energy minister announced that more than 507,000 batteries had been installed under the program.
- From 1 May 2026 the rebate is tiered: full discount to 14kWh, 60% per kWh from 14 to 28kWh, and 15% per kWh from 28 to 50kWh.
- Average installed systems had grown to around 28kWh by the 400,000-install mark, well above the roughly 10kWh AEMO assumes for a typical home battery.
Why it matters
- What it limits constraint A 28kWh system, the size buyers had settled on, now earns about 80% of the discount a flat full-rate rule would give, so the largest installs lose the most.
- Who has to decide decision Anyone sizing 2027 battery-linked inventory or installer capacity has to decide whether 2026 volumes are a baseline or the peak Telsyte forecasts.
- What it sets up precedent A 2022 forecast for 2026 now sits under half of the current path, so we'd expect sizing of this market to be revised each time the rebate rules change.
The two-thirds figure leaves a remainder, and the remainder is where an AI claim would have to show up. Two-thirds of A$7.7 billion is about A$5.1 billion [18], against roughly A$1 billion in 2024, so the battery line grew to about five times its earlier size [20]. Everything else in the market came to about A$2.6 billion [19] and grew 19% [8]. That remainder holds every non-battery product, AI-enabled ones included. Growth of 19% is solid, and it is far slower than the battery line.
Telsyte's survey data supports a demand story as well. Ownership of at least one smart home product was already 76% in 2024 and 69% in 2022, and reached 86% by June 2026 [9]. Some 71% of households now have a dedicated smart home budget [10], and 58% feel more financially stretched than a year ago [11]. Cost pressure is a real driver.
The battery jump nonetheless follows the July 2025 launch of the program [3], and Telsyte credits the rebate and the squeeze together [2]. We think the timing makes the rebate the trigger and the squeeze the reason households answered it. The coverage of the study does not include an AI revenue line or a split of battery demand between the two causes, so the AI half of the thesis rests on the size of the remainder alone.
Future battery demand has a pool to draw on. Energy Minister Chris Bowen said households had taken up the scheme "with gusto" [6]. "Many solar powered homes are taking the next step with batteries and EVs," Telsyte Managing Director Foad Fadaghi said [16]. About two in five Australian homes have rooftop solar, and more than a third of households without solar or storage are interested in installing them [15]. That pool exists whatever the rules say. We'd expect the rebate to set the price at which it converts, and the program's budget has swelled to A$7.2 billion over four years [4].
What to watch
- Whether 2026 battery revenue and share come in at the peak Telsyte forecasts, now that the May tiering is in force.
- Any further change to the rebate rules or to the program's A$7.2 billion, four-year budget.
- A published AI-feature revenue line, which would test the claim that AI is a minor driver.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence55
- Adoption80
- Hype gap+10
- Incentives
- Not scored
- Confidence55
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
Telsyte's Australian Smart Home Market Study 2025-2029, released Monday 12 October, says Australia's smart home market more than doubled to $7.7 billion in 2025 and is on track to top $11 billion this year.
- [2]
Home batteries, boosted by the Federal Government's Cheaper Home Batteries Program and a persistent cost-of-living squeeze, account for two-thirds of all smart home revenue.
- [3]
Smart battery revenue jumped 396% year on year in 2025, following the July 2025 launch of the Cheaper Home Batteries Program.
- [4]
The Cheaper Home Batteries Program's budget has swelled to $7.2 billion over four years.
- [5]
In August, Prime Minister Anthony Albanese and Climate Change and Energy Minister Chris Bowen announced that more than 507,000 batteries had been installed under the program.
- [6]
Bowen said households had taken up the scheme "with gusto."
- [7]
In 2022, Telsyte forecast the Australian smart home market would reach $4.7 billion by 2026.
- [8]
With batteries stripped out, the rest of the smart home market still grew 19% in 2025.
- [9]
As of June 2026, 86% of Australian households own at least one smart home product, up 10 percentage points since 2024 and up from 69% in 2022.
- [10]
Households with a dedicated smart home budget rose from 44% to 71% over two years, and the average budget among them climbed by more than $1,300 to over $3,500 in 2026.
- [11]
58% of Australians feel more financially stretched than a year ago, and 69% are actively trying to lift income or cut expenses.
- [12]
From 1 May 2026 the battery rebate is tiered by size: the full discount applies up to 14kWh, 60% for each kWh from 14 to 28kWh, and 15% for each kWh from 28 to 50kWh.
- [13]
Average system sizes had crept up to around 28kWh by the 400,000-install mark, well above the roughly 10kWh AEMO has assumed for a typical home battery.
- [14]
Telsyte expects the battery share of smart home revenue to peak in 2026 and then ease back to just over half by 2029 under the new tiered structure.
- [15]
About two in five Australian homes already have rooftop solar, and Telsyte found more than a third of households without solar or storage are interested in installing them.
- [16]
Telsyte Managing Director Foad Fadaghi said: "Many solar powered homes are taking the next step with batteries and EVs."
- [17]
Telsyte's 2022 forecast for 2026 (A$4.7 billion) is about 43% of the A$11 billion-plus path now projected, so under half of it.
- [18]
Battery revenue in 2025 was about A$5.1 billion.
- [19]
Non-battery smart home revenue in 2025 was about A$2.6 billion.
- [20]
Battery revenue in 2024 was roughly A$1 billion, so the 2025 battery line was about five times its 2024 size.
- [21]
A 28kWh system receives about 80% of the discount a flat full-rate rule would give, assuming the 60% tier applies to the per-kWh discount.
- [22]
Smart home product ownership was 76% in 2024.
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Sources
1 independent publisher whose own reporting we read for this story.
- itwire.comBatteries push Australia's smart home market past $11 billion as AI waits for the keys
1 article · October 13, 2026
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