The Australian Renewable Energy Agency (ARENA) has announced $120 million in funding that will be made available for Round 1 of the Community Batteries Funding Program.

The program aims to support the deployment of community batteries across Australia to lower energy bills, cut emissions and reduce pressure on the electricity grid.

ARENA is now seeking applications for up to $20 million in funding to deploy a minimum of five community batteries.

To be eligible for ARENA funding, each community battery must be between 50kW and 5MW in size and connected to the distribution network.

ARENA has allocated $120 million in funding for Round 1, split equally across two streams. Stream A is Distributed Network Service Providers (DNSP) and Stream B are those that are not DNSPs.

Community batteries provide energy storage in the distribution network that can store excess solar energy for later use, putting downward pressure on household electricity costs, and easing pressure on the local electricity grid.

ARENA chief executive Darren Miller says community batteries represent the next step in optimising distributed energy resources in the electricity grid.

“Not everyone is able to install rooftop solar, but by storing electricity close to the point of consumer demand, we can reduce network costs and alleviate constraints in areas with high solar penetration. This will ultimately reduce electricity costs for all consumers,” he explains.

“We’re excited to be working on this initiative to support the roll out of these 342 batteries across Australia.”

As part of the 2022/23 Federal Budget, the Australian Government allocated $200 million for the Household Solar budget measure to deploy 400 community batteries across Australia. ARENA was allocated $171 million of this funding to deliver at least 342 batteries.