Batteries
What a virtual power plant actually is, what it pays, and what you hand over
Put a battery on the wall and someone will offer to pay you to join a
VPP. The regulator has a definition, and the whole thing turns on one word. The ACCC calls it
an agreement between a customer and retailer (or other operator) where the customer
relinquishes some control over its solar and battery assets in return for a financial
reward
. The reward is real and large. So are the three gaps the ACCC found on the other
side of it.
What it pays
The ACCC put numbers on both steps. Compared with regular customers,
customers with a solar and battery system had median annual bills that were between $329 to
$909 (20-52%) lower than regular customers
. And
those participating in virtual power plants had median annual bills that were between $762 to
$1,093 (57
to 63 per cent) lower
.
So joining roughly doubles the bill benefit of owning the battery. That is not a marginal inducement, and any honest account of VPPs has to start there rather than with the risks.
The number we said we would go and find
When we read the national grid plan earlier this year we wrote that it
assumes just over half of home batteries will be
coordinated in a VPP, and that the plan does not publish how many are in one today. We said
that was the number worth chasing. Here it is, from the ACCC:
As of January 2026, only around 24% of customers with installed batteries participate in a
virtual power plant
.
Set against the forecast, the same report states that AEMO
estimates in its step change scenario that, if approximately 53% of customers with a battery
participate in a virtual power plant by 2050, about $7.2 billion in additional generation and
network infrastructure investment could be avoided
.
A note on that figure, because we have published a different one. Our story on the grid plan quoted up to $5 billion of avoided utility-scale storage. The ACCC's $7.2 billion covers generation and network investment together. They are measurements of different things and we have left both as their authors stated them rather than reconciling them into one number.
What you hand over, and the three gaps
The ACCC's own word is relinquishes
. In practice a VPP operator decides when your
battery charges and discharges. The report is not against that arrangement, and it recommends
encouraging it. What it found is that the consumer scaffolding around it is incomplete in three
specific ways.
Dispute resolution. If something goes wrong with the hardware, the usual
energy complaints route may not be open to you. The ACCC found that in many cases customers
lack access to external dispute resolution as it sits outside ombuds schemes
jurisdictions
. Your retailer is inside the ombudsman's remit; the company that sold and
installed the battery often is not.
Complexity. Virtual power plant products are complex and vary
significantly between operators
. There is no standard product to compare, so two offers that
look similar can differ on how much control you give up, how you are paid, and what happens if
you want out.
Getting out again. This is the one that surprised us.
Most battery brands are compatible with only a portion of virtual power plants
, which
means the hardware you already own can decide which offers are available to you. The ACCC's
remedy names the problem plainly: improving interoperability
will better enable customers to switch to another provider if a virtual power plant is not
working for them
. Switching is the discipline that keeps any offer honest, and on this
market it is partly a function of what is bolted to your wall.
Where participation is highest, and why that matters
The report notes that virtual power plant participation is highest in New South Wales
,
where eligible battery customers can receive an additional state incentive for joining. Uptake
follows money, which is unsurprising, and it is also the ACCC's argument for targeting future
support at participation where protections exist rather than at installation alone.
Our view
Labelled as opinion, built on the figures above. A VPP is a reasonable deal on the numbers and an under-specified one on the paperwork. Roughly doubling the bill benefit of a battery is a genuine offer, and the 24 per cent participation rate is not evidence that households are wrong to hesitate; it is evidence that the product is hard to compare and hard to leave.
The compatibility finding is the one we would act on first if we were buying. The rebate conversation is entirely about system size and price, and almost nothing in it tells a household that the brand they choose narrows the set of VPPs they can ever join. That is a decision made once, at purchase, that constrains every offer afterwards, and it is not currently anyone's job to mention it.
What this page does not tell you
It does not recommend a VPP or a battery brand, and it names none. The bill figures are medians across sampled customers, not a quote for your house, and they exclude the Energy Bill Relief Fund, which has since ended. The participation figure is as at January 2026 and the report was published in July, so both will move. We have not tested any VPP product, spoken to any operator, or reviewed any contract, and nothing here is advice about one.
Sources
- Australian Competition and Consumer Commission, Inquiry into the National Electricity Market, June 2026 report (PDF, downloaded and read 26 Aug 2026): the definition of a virtual power plant and the forms the financial reward may take; the median annual bill comparisons for battery and solar customers and for virtual power plant participants; the January 2026 participation figure of around 24 per cent of customers with installed batteries; AEMO's step change estimate of approximately 53 per cent participation by 2050 and about $7.2 billion of avoided generation and network investment; the finding that many customers lack access to external dispute resolution because it sits outside ombuds scheme jurisdictions; that virtual power plant products are complex and vary significantly between operators; that most battery brands are compatible with only a portion of virtual power plants and the interoperability remedy stated in terms of switching; and that participation is highest in New South Wales.
How we did this. Every figure and quotation is from the ACCC report itself, downloaded and read rather than taken from coverage of it, and the file we read matched the copy this masthead already held byte for byte. One deliberate choice worth stating: this page quotes an avoided-investment figure of $7.2 billion while our earlier story on the grid plan quotes up to $5 billion. Both are correct and they measure different things, so we have left each attributed to its author instead of reconciling them, which is the same rule we applied when two government sources gave different shares for water heating. No operator, retailer or battery brand is named or assessed anywhere on this page, and the subject is a published regulatory report.
See something wrong? Request a correction and we will check it against the report and log the outcome here.