By putting billions of dollars towards critical minerals and green hydrogen, Australia is finally getting serious about a clean energy future.

The federal government should be lauded for its efforts to make us a clean energy superpower with its Future Made in Australia plan.

Yet the government has missed a big – perhaps the biggest – piece of the puzzle.

Alongside critical minerals and green hydrogen, the government should make big plays to support the rise of the humble home battery and heat pump.

More domestic carbon emissions are created in our homes and from our cars (40 per cent) than from our country’s businesses and their operations (30 per cent).

Electrification boost

Millions of households have already saved on their power bills and cut emissions by electrifying parts of their home life.

The electricity sector has achieved a 26 per cent drop in emissions in the past 15 years, while other sectors have remained largely static.

Rooftop solar contributed 11 per cent of total supply in the national electricity market last year – more than double the power generated from gas.

That solar delivers electricity to homes at a cost of 3 to 6cents/kWh, a small fraction of the 30cents/kWh electricity from the grid.

We have the world’s cheapest renewable energy, and we could all share in lower electricity prices if the federal government’s approach to Australia’s clean energy future expanded to include our homes and cars.

Immediate steps

There are two steps Labor should take immediately.

First, the government should set the right regulations to encourage consumers to electrify.

Last week Ausgrid, the biggest electricity distributor on the east coast, announced plans to charge solar panel owners who export power to the grid during off-peak daytime hours.

The aim is to encourage households to use energy in the middle of the day, and export to the grid at night – to prevent excess electricity from rooftop solar entering the grid, raising voltage within our electricity networks and causing technical issues with transformers and inverters.

Other energy distribution businesses are reportedly considering adopting similar pricing frameworks, effectively penalising home owners who have solar panels but not a home battery to store their extra electrons in the middle of the day.

These charges make no sense. The Australian Energy Regulator has said that our electricity network is “not designed for large amounts of energy flowing back into the network.” It should be.

Grid locked

Ausgrid is spending less than one per cent of its revenue to support rooftop solar. It, and other electricity providers, could do much more to ensure that the grid can accommodate 10 million electrified households.

We need a review of energy market governance to ensure the appropriate technical standards are in place.

These technical standards should be governed via a dedicated Distributed Energy Resources Authority – like the Therapeutic Goods Administration regulates medicines.

Setting up the right regulations and governance structure will give confidence to the market that electrified households are central to Australia’s net-zero future.

This will take the pressure off the grid.

Battery power

If more households have their own batteries that can communicate with each other behind the meter, this will become a vital source of reliable, cheap and clean energy.

Secondly, the federal government should help households stump up the capital needed to switch appliances and vehicles.

The initial costs for purchasing solar panels, a battery or an electric vehicle are high, but they set up households for a lifetime of savings.

We should be taking full advantage of solar power by maximising rooftop panel installation and increasing storage capacity in homes (“behind the meter”) – via cheaper home batteries, heat pump hot water systems, and electric vehicles (their 40-60kWh batteries are four to six times the size of a typical home battery).

Only 12 per cent of homes that installed solar last year installed a battery too.

Aren’t we better off giving low-cost loans or rebates on power bills to incentivise battery purchases – or, even better, getting more Australians into EVs with bidirectional charging capacity – than charging home owners for putting electricity into the grid?

Home improvement

Thursday’s announcement about the $532 million committed to the National Battery Strategy is welcome, but seems focused on battery production rather than getting batteries into homes.

The Australian government should be doing all it can to facilitate home owners becoming energy producers with flexible demand and storage.

The benefits are obvious:

• Lower power bills, as households generate their own electricity (a much more durable and significant societal change than a $300 electricity bill rebate)
• Less need for large-scale renewable generation, transmission and storage (progress on which is slower than the government would like)
• A more reliable and resilient electricity network with distributed storage capacity in every suburb – ideally in every home.

By 2050, the cumulative storage capacity in electric vehicles in Australia will be four times the energy storage requirements for the national electricity grid.

Missing links

By linking those EVs to the grid, we could save the country tens of billions of dollars in infrastructure builds for batteries and large-scale storage.

Labor’s Future Made In Australia plan is set up to prepare industry for the net-zero economy.

Every Australian household should have the same opportunity. The government must get the regulations right and give households a helping hand to access cheap electricity.

A battery here and a heat pump there doesn’t sound as visionary as transforming Australian industry; but they could be even more vital to the net-zero transition, and to helping everyday Australians reap benefits from the new economy.

Monique Ryan is the independent federal member for the Melbourne seat of Kooyong