The Honest Answer First
Both options can make financial sense — it entirely depends on when you use electricity and what your goals are. Solar panels only make sense if you use a lot of power during the day. Batteries make sense if you use most of your power in the evenings and want to maximise the value of your solar generation.
The good news: in 2026, the Federal Cheaper Home Batteries Program means batteries are more affordable than ever — roughly 30% cheaper than they were two years ago after rebates. The case for adding a battery has never been stronger.
Solar Only — When It Makes Sense
A solar-only system generates electricity when the sun shines. Any power you generate that you're using in real time gets consumed at full retail value (saving you ~32 cents/kWh). Any surplus gets exported to the grid at the feed-in tariff — currently around 5–10 cents/kWh from most NSW retailers.
The problem with export rates
This is the core issue with solar only in 2026. You're generating electricity worth 32 cents/kWh but getting paid 5–10 cents for what you don't use immediately. That's a 70–80% discount on your own electricity. Every kWh you export and then import back in the evening costs you roughly 24–27 cents in the difference.
Example: A 10kW system generating 40 kWh/day. If you're at work from 8am–6pm and only consume 8 kWh during daylight hours, you're exporting 32 kWh at 7 cents = $2.24. You then import 18 kWh in the evening at 32 cents = $5.76. Net daily cost: $3.52. A battery would store that 32 kWh surplus and eliminate the evening import cost entirely.
✅ Solar only is a good fit if:
- Someone is home during most daylight hours (retirees, work-from-home, shift workers)
- You run most appliances during the day — pool pump, dishwasher, washing machine
- Budget is tight and you want the fastest simple payback
- You plan to add a battery in 1–2 years once you've seen your savings
Solar + Battery — When It Makes Sense
A battery stores surplus solar during the day and releases it when you need it — typically evenings and overnight. Instead of exporting at 7 cents and importing at 32 cents, you use your own stored solar at full retail value.
The numbers in 2026
After the Federal Cheaper Home Batteries Program rebate (~$300/kWh usable), a 10kWh battery adds roughly $4,000–$5,500 to your system cost (after rebate). At 18 kWh of avoided grid imports per day at 32 cents/kWh, that's approximately $2,100/year in additional savings compared to solar only. Payback on the battery component alone: roughly 2–2.5 years at current rates.
2026 rebate deadline: The Federal battery rebate reduces significantly for systems over 14kWh after 1 May 2026. If you're considering one of our larger Solis or Growatt systems (50–53kWh), the current rebate at ~$300/kWh means $10,000–$15,000+ off the upfront cost. This deadline is real and the savings are substantial.
🔋 Solar + battery is a good fit if:
- Most of your household electricity use happens in the evenings (typical 9-to-5 household)
- You want to maximise bill reduction — targeting 80–90% savings, not just 40–60%
- You want backup power in the event of a grid outage
- You're considering an electric vehicle in the next few years
- You want to take advantage of current federal rebates before they reduce
Side-by-Side Comparison
| Factor | Solar Only | Solar + Battery |
|---|---|---|
| Upfront cost (10kW) | ~$8,000–$10,000 | ~$12,000–$18,000 (after rebates) |
| Bill reduction | 40–60% | 80–90% |
| Payback period | 3–5 years | 4–6 years (full system) |
| Overnight coverage | None — imports from grid | Fully covered by battery |
| Blackout protection | No (shuts off in blackout) | Yes (with compatible inverter) |
| Feed-in earnings | 5–10c/kWh for excess | Minimal — battery stores most surplus |
| Current rebates | Federal STCs only | Federal STCs + Cheaper Home Batteries |
| EV charging compatibility | During daylight only | Anytime — use stored solar overnight |
Understanding Payback Period
The payback period comparison can be misleading. A solar-only system might pay back in 3.5 years but leaves you paying full grid rates at night for the next 22 years. A solar + battery system might take 5 years to pay back but then saves you $3,000–$4,500 per year for the remaining 20 years of the system's life.
The better metric is lifetime return. Over 25 years, a solar-only system might save $45,000 in today's money. A solar + battery system for the same home might save $75,000–$90,000. The battery adds $30,000–$45,000 in lifetime value for an upfront cost difference of $4,000–$8,000 after rebates.
The Hybrid Approach — Solar Now, Battery Ready
If budget is the constraint, a smart middle ground is installing a hybrid inverter with your solar panels now. A hybrid inverter is battery-ready — when you add a battery in 12–24 months, there's no need to replace the inverter or pay additional setup costs. It typically adds only $500–$800 to the upfront solar cost and future-proofs your system completely.
This approach lets you capture the Federal STC solar rebate now, then add a battery when the Cheaper Home Batteries Program rebate is still active (or the next government program rolls out).
Important: Not all solar inverters are battery-compatible. If you install a standard string inverter without battery capability now, adding a battery later requires replacing the inverter — adding $1,500–$3,000 to the cost. Always ask your installer about battery compatibility before committing to a solar-only system.
Our Recommendation for Most NSW Households
For most households in Greater Sydney with a bill over $300/quarter and the majority of consumption in evenings: solar + battery is the right choice in 2026, primarily because the Federal Cheaper Home Batteries Program makes batteries significantly more affordable than they've ever been, and because the current rebate rate on larger systems reduces after 1 May 2026.
If budget is genuinely constrained, solar only with a hybrid inverter is a sensible stepping stone. What we'd advise against is solar only with a standard non-hybrid inverter — it costs almost the same but closes the door on easy battery addition later.
Not Sure Which Is Right for You?
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Get My Free Comparison →Common Questions
Yes in most cases, but it depends on your existing inverter. If you have a hybrid inverter already, adding a compatible battery is straightforward. If you have a standard string inverter, you may need to replace it with a hybrid unit — typically $1,500–$3,000 additional cost. We assess your existing equipment as part of the free quote process.
Most modern battery systems with compatible hybrid inverters provide blackout protection — your home automatically switches to battery power during a grid outage. However, the capacity to run your entire home depends on battery size. Our larger 50–53kWh systems can power a typical home for 2+ days during an extended outage.
Your feed-in tariff remains available for any surplus solar that your battery doesn't capture. In practice, with a correctly sized system, the battery will absorb most of your surplus and feed-in earnings will reduce — but you're better off because you're consuming that solar at 32 cents/kWh rather than selling it at 7 cents.