Looking back on another dynamic year in the Australian solar and energy storage industry, it is clear that lithium-ion batteries have taken centre stage as the key enabling technology for the energy transition.
There’s never a boring year aboard the “solarcoaster” and 2024 was no exception. Australia’s energy market continues to evolve at a breakneck pace, with policy, regulatory, and industry developments buffeting consumers and market participants alike. And when looking for larger trends, it is clear that batteries have assumed a central position – particularly when it comes to utility-scale deployment.
But that’s not to say that the other renewable energy technologies are standing still. Even with a severe oversupply market dynamic gripping the solar manufacturing segment, there is still impressive technological progress. Although it hasn’t come without missteps and some new quality issues have emerged.
You could also be forgiven for thinking that the policy discussion around energy in Australia in 2024 has been entirely about nuclear – thanks to the federal Coalition’s new support for the technology. But there have also been state and federal policies that will have a lasting impact on clean technology rollout in the country. And regulators have also been active in introducing notable reforms.
While it’s not possible to cover everything in a single post, here are some highlights of solar and storage in the Australian marketplace in 2024.
1. Big batteries dominate
It’s a good time to be developing and supplying large scale battery projects. Earlier this month, Rystad released its numbers showing that 4.9 GW/13 GWh of utility scale battery projects commenced construction in 2024. While it is a continuation of a trend that began last year, that so many big battery projects are reaching financial close demonstrates how much value there is in shifting solar production into the evening and night.
While the first utility scale battery projects were developed to maintain electricity system strength, through the FCAS or ancillary services markets, arbitrage trading can now be a profitable endeavour. With negative wholesale electricity prices during peak solar hours becoming increasingly common and then sky-high peaks when the market is short on supply, batteries charge on cheap power – or be paid to do so – and then discharge at great profit.
“Volatility in the market is still super high in Australia,” says Rystad Energy’s David Dixon. And he doesn’t expect that volatility to go away anytime soon.
Interestingly, with construction starting on battery installations of almost 5 GW, it exceeds that of large scale solar and wind – which came in at 3.5 GW combined.
Other analysts are also observing the trend, with BloombergNEF reporting that 1.5 GW/4 GWh of utility scale batteries were installed in 2024. It expects 2.1 GW/8 GWh of big batteries to be completed in 2025.
2. Chinese batteries thrive
While the early stages of battery market development in Australia was dominated by U.S. and European suppliers, today Chinese companies are having considerable success.
While Tesla still has a very strong position in the utility scale battery segment – according to Rystad – Chinese suppliers are having major project wins. Among the utility-scale batteries that commenced construction this year, Trina Storage, Canadian Solar, and Sungrow were selected to supply large projects.
In the distributed market segment, Melbourne based analyst Sunwiz published data during the year showing that Chinese battery makers comprise three of the top-five places in terms of market share – namely AlphaESS, BYD, and Sungrow.
While the final numbers are yet in, Sunwiz expects around 60,000 residential batteries to be installed in Australia in 2024. The attachment rate – the percentage of solar systems that are installed alongside a battery – is around 20%. This is encouraging, but a far cry from the close to 80% attachment rate in Germany.
3. Calls for residential battery subsidies
The Clean Energy Council (CEC) added its voice to the growing chorus calling for a federal program to subsidise residential batteries this year. Describing it as the “missing piece of the puzzle,” the CEC argued that a subsidy of $6500 would not only be valuable for home and small-business owners, but also to the electricity network; by soaking up solar during the day and making it available when it was needed.
The move by the CEC joins voices from other parts of the industry that argue that the Small-scale Renewable Energy Scheme (SRES) could be repurposed to support battery installations. And with PV module prices at record lows, there is a pretty good logic behind the argument.
On the other hand, battery prices are falling fast. BloombergNEF released findings in December showing that battery cell and pack prices declined by 20% in 2024. While those prices don’t translate directly into cheaper residential battery prices immediately, the trend is clear. (As an aside, the fall in battery price was so steep that the analysts from Bloomberg had to revise their “learning curve” expectations for lithium-ion batteries)
Given falling costs and the increased value that batteries can generate as homes go electric, in providing backup power and safeguarding solar homeowners from having their system switched off in “minimum demand” events to name only two, home energy storage is fast becoming a smart decision for homeowners.
New state-based subsidies for home batteries came into effect this year: in NSW and Queensland. They joined the existing interest-free loans that are available in Victoria.
4. TOPCon number one – and what it means
While batteries are capturing all the attention, there is still a huge amount of solar being installed on rooftops right around Australia. Sunwiz anticipates sub-100 kWp installations of around 3.2 GW to be achieved in 2024. As of November, installations under the SRES were tracking 2% above 2023 levels.
When it comes to technology, there is no doubt that 2024 saw the TOPCon solar cell and module become the mainstream industry product, surging past the previous incumbent PERC. And with TOPCon achieving cell efficiency records above 26.5%, with Trina and JA Solar leading the way, it is clear that it can achieve impressive power outputs. The best TOPCon module comes in at 25.42%, produced by Jinko.
But there are downsides to the new top cell technology. Due to challenges in metallisation, manufacturers have been using pastes that contain higher levels of aluminium in their TOPCon cells. This can leave them prone to degradation – particularly relating to moisture ingress.
As a response, dual-glass TOPCon modules are now ubiquitous, but this also brings challenges. With large formats, both front and rear glass is thinner than ever before: 2 x 2.0 mm glass is commonplace, as opposed to the previous mainstream combination of 3.2 mm front side and rear backsheet. Such thin, untempered glass can be prone to cracking, making good handling practices during transportation and installation vital.
Dual 2.0 mm glass modules can also be prone to cracking, either cells or glass itself, when struck with hail, a result confirmed in the latest Kiwa PVEL PV Module Reliability Scorecard.
5. Data-center demand, VPPs, Chinese EVs, green steel, V2G and more…
While brevity is said to be a virtue, a year in Australian solar and energy storage makes it almost impossible. Beyond the trends set out in 1 to 4 there are a myriad of others that were worthy of attention. Taken together they form a picture in which many things are changing rapidly, often in new and unpredictable ways.
What they also demonstrate is that there are vast opportunities for solar and battery energy storage to play a central role in our energy system, our homes, and Australian industry. 2024 saw many things change, but there is surely more to come.