Australia’s rooftop solar boom shows no sign of slowing
Australia’s love affair with rooftop solar is no longer a novelty story. It is a structural shift in how the nation generates, stores, and increasingly manages electricity. The latest data from the Clean Energy Council confirms that rooftop solar uptake remains one of the most significant contributors to Australia’s energy transition, even as growth in new installations begins to mature.
According to the Clean Energy Council’s Rooftop Solar and Storage Report July–December 2025 (1), more than 4.3 million Australian households now have rooftop solar installed, representing 28.3 GW of generation capacity. That is more capacity than the country’s entire fleet of coal-fired power stations. As per the report, rooftop solar contributed 14.2 per cent of Australia’s electricity supply in 2025, almost double its share just five years earlier.
While the total number of new rooftop systems installed in 2025 eased from record highs seen in previous years, this does not signal declining interest. Rather, it reflects a market approaching saturation across suitable rooftops, with consumer focus shifting from generation alone to storage, optimisation, and energy independence.
Storage takes centre stage
One of the most striking developments highlighted in the Clean Energy Council data is the explosion in household battery installations. As per the report, 183,245 home batteries were sold in the second half of 2025 alone, equivalent to almost all battery installations recorded between 2020 and 2024 combined.Rooftop-solar-and-storage-biann…
This surge has been driven by a combination of rising electricity prices, declining battery costs, and direct government intervention. Federal and state programs, including the Cheaper Home Batteries initiative, have materially shortened payback periods and encouraged households to invest in storage alongside rooftop solar.
An Australian Financial Review article published in February 2026 (2) reinforces this trend, noting that households are installing batteries at record pace, even if many are not yet capturing the full economic benefits by participating in virtual power plants. The article underscores that distributed energy assets are becoming a core part of the electricity system rather than a peripheral feature.
A growing problem hiding in plain sight
Yet, beneath this success story sits a less comfortable reality. Australia’s rooftop solar boom is creating a looming waste challenge that policy makers, industry, and investors can no longer ignore.
As we previously outlined in our discussion of New South Wales’ leadership on mandatory solar panel recycling, the first wave of rooftop solar systems is now reaching end-of-life. While NSW has taken early steps to address this issue through regulatory reform, recycling frameworks remain inconsistent nationally, and capacity is limited. (3)
This challenge has now reached the federal stage. In February 2026, Sophie Vorrath reported that federal parliament launched a formal inquiry into solar panel reuse and recycling, following the release of a Productivity Commission report showing that only 17 per cent of discarded rooftop solar panels are currently recycled in Australia. The remainder are stockpiled, landfilled, or exported for reuse under limited oversight. (4)
The inquiry is timely. As per the Productivity Commission findings referenced in the article, recycling a solar panel currently costs around six times more than sending it to landfill. That price signal alone explains why recycling rates remain low, despite clear environmental and economic logic for doing otherwise.
Recycling as the next phase of the solar transition
The recycling issue is not a failure of rooftop solar. It is a sign of success arriving faster than policy frameworks were designed to handle. Australia has installed solar panels at a per-capita rate unmatched globally. The consequence is predictable. A growing volume of panels will need to be reused, refurbished, or recycled at scale.
Encouragingly, policy momentum is now building. The federal government has committed $25m to pilot up to 100 solar panel collection sites nationwide, aimed at reducing transport costs and creating viable supply chains for recycling operators. As Sophie Vorrath tells us, the parliamentary inquiry will also examine opportunities to recover valuable materials such as aluminium, silver, and silicon, moving the sector closer to a circular economy model.
This mirrors the earlier trajectory of battery recycling and electronic waste regulation. What begins as an environmental obligation often evolves into an investable infrastructure opportunity.
What this means for investors
For investors, the rooftop solar story has entered a new phase. The early gains from panel manufacturing and installation are giving way to a more complex ecosystem spanning storage, grid services, digital optimisation, and end-of-life management.
The scale is already visible. Rooftop solar installations are expected to exceed the capacity required under AEMO’s Integrated System Plan by around 1 GW by 2029–30, as per the Clean Energy Council report. That creates ongoing demand for batteries, virtual power plant platforms, network services, and grid-integrated software.
At the same time, solar panel recycling represents a long-dated but increasingly unavoidable investment theme. As regulatory standards tighten and landfill options narrow, recycling economics will improve. Early movers with scalable processing technology, logistics capability, and regulatory alignment stand to benefit.
Crucially, this is not a niche environmental trade. It is infrastructure. Australia’s rooftop solar fleet is now one of the largest power stations in the country. Maintaining it, upgrading it, and ultimately recycling it will require capital, innovation, and patient investment.
The Bottom Line
Australia’s rooftop solar boom is one of the great energy transition success stories. The latest data confirms that households are not only generating power at scale but increasingly storing and managing it as part of the national grid. At the same time, the recycling challenge is emerging as the next critical chapter. For investors, this combination of proven adoption, policy support, and unresolved structural needs creates a compelling long-term opportunity across storage, grid services, and circular energy infrastructure.
References
Clean Energy Council, Rooftop Solar and Storage Report July–December 2025, 4 February 2026, https://cleanenergycouncil.org.au
Macdonald-Smith A, Australian Financial Review, Home batteries smash records, but households miss out on extra dollars, 4 February 2026, https://www.afr.com/policy/energy-and-climate/home-batteries-smash-records-but-households-miss-out-on-extra-dollars-20260203-p5nz53
EnviroInvest, NSW Leads on Mandatory Solar Panel Recycling 25 August 2025 https://www.enviroinvest.com.au/blog/nsw-leads-on-mandatory-solar-panel-recycling
Vorrath S, RenewEconomy, Federal parliament launches inquiry into solar panel reuse and recycling, 4 February 2026, http://reneweconomy.com.au/federal-parliament-launches-inquiry-into-solar-panel-reuse-and-recycling/
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