Home battery subsidy scheme lauded despite government's search for cuts

Murray Watt says all ministers have been asked to look for savings in their own portfolios before the mid-year budget update

The environment minister has praised the home battery subsidy scheme as “phenomenally successful” as the prime minister declined to rule out means-testing the $7.2b program

The Coalition is calling for the scheme to be scrapped entirely, labelling it as "unsafe and unaffordable".

Environment Minister Murray Watt says he and all other ministers have been told to find savings in their portfolios, as pressure on the federal government to cut spending ramps up.

The RBA this week lifted interest rates for the fifth time this year, bringing the cash rate to an 18-year high and prompting the prime minister to commit to finding savings in the upcoming mid-year budget update [MYEFO].

Speculation continues about where savings will be found, with the prime minister telling the ABC that means-testing home battery or electric vehicle subsidies was not ruled out.

On Saturday, the Australian Financial Review reported Treasury is drafting options to cut back the home battery scheme, including lowering the subsidy available on the up-front cost of a unit.

Senator Watt said where savings could be found was still under review through the Expenditure Review Committee [ERC], but lauded the Cheaper Home Batteries Scheme as "phenomenally successful".

"But again, we will be looking for savings right across government," he said from Brisbane, where he provided the government's weekly fuel supply update in place of the Energy Minister Chris Bowen, who is travelling to Türkiye for the COP31 climate summit.

Mr Bowen took to social media on Friday to celebrate 600,000 home batteries being installed since the program began in 2025.

"They are also putting downward pressure on prices for everyone, whether or not you have a battery," he said in the post.

Changes to home battery rebates came into effect in May this year, in a bid to ensure the $7.2 billion scheme did not run out of money too quickly.

Shadow Energy Minister Dan Tehan said the program, which he labelled "unsafe and unaffordable", must go.

"If Labor were serious about addressing inflation, they would simply scrap the subsidy altogether," Mr Tehan said in a statement.

Shadow Treasurer Tim Wilson was asked by reporters in Melbourne today whether the government should consider means-testing the home battery program.

"Our focus is getting rid of government programs that are stoking inflation right now; that's why we've put $31.3 billion in savings before the Albanese government," Mr Wilson said.

Echoing Mr Albanese and Finance Minister Katy Gallagher this week, Senator Watt accused the opposition of blocking "$10 billion of savings" currently before the Senate.

"On their logic, if they're saying that increased spending means higher inflation, then they are driving inflation higher by refusing to back in those savings that we've put forward," he said.