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The Australian Renewable Energy Agency (ARENA) has conditionally approved up to $143 million to support the roll out of up to 370 community batteries across Australia under its Community Battery Funding Round 1.

All states, and the Northern Territory, are expected to benefit from this program, unlocking an expected $359 million of investment in renewable energy infrastructure.

Once online, the batteries will have a tangible impact on local network constraints and will expand rooftop solar capacity, reduce emissions and reduce electricity costs for consumers. The range of energy consumers that will benefit from these batteries include households, hospitals, schools and tertiary education institutions, council facilities, housing developments, social and community housing, sports facilities, libraries, aquatic centres, shopping centres, and regional and remote communities.

ARENA CEO Darren Miller said community batteries will enhance energy resilience, reliability and sustainability while bringing down energy costs for consumers and businesses.

“ARENA is pleased to support the roll out of these batteries through our transformative program which will have a significant impact upon Australia’s energy and grid security while delivering cleaner and more cost-effective energy for our communities. We are encouraged to see this important asset class being demonstrated at such a scale and expect that this funding round will kick start the neighbourhood-scale storage sector.”

The October 2022 Federal Budget provided $200 million for the Community Batteries for Household Solar Budget Measure to deploy 400 community batteries across Australia. Of this, $171 million was allocated to ARENA to deliver at least 342 batteries, with the remainder being delivered by the Department of Climate Change, Energy, the Environment and Water (DCCEEW).

ARENA received a strong response under Round 1, with 140 eligible Expressions of Interest received. Funding has now been conditionally allocated to 21 applications (from 20 applicants); 10 applications requesting $67.3 million under Stream A Distribution Network Service Providers (DNSPs), and 11 applications requesting $75.7 million under Stream B Non-DNSPs.

The batteries will have an aggregated storage capacity of up to 281 MWh, which will enable storage and use of renewable electricity generated across Australian communities. ARENA will contribute up to $0.51 / Wh in grant funding against an average cost of $1.28 / Wh (39.8%).

Specific locations for the batteries are yet to be finalised and are subject to community consultation, planning approvals and entry into commercial agreements. All ARENA funding is conditional on the finalisation of funding agreements with each successful applicant.

ARENA expects to launch a second round of community battery funding in late 2024, with a funding allocation of at least $28 million