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$100 million renewable energy program to fast-track grid-ready solar and battery projects

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The Australian Government has committed $100 million to help small and medium-sized renewable energy projects overcome financing barriers and move into construction sooner.

The investment will support up to 16 hybrid solar, battery storage and battery retrofit projects through a new financing initiative delivered by the Clean Energy Finance Corporation and Infradebt.

What has been announced

The Clean Energy Finance Corporation, or CEFC, is working with infrastructure debt manager Infradebt to establish the Distribution Connected Accelerator Program.

The program will provide concessional senior debt to eligible renewable energy projects, with applicants to be selected by Infradebt through a competitive process.

The government said the initiative is intended to address the financing challenges faced by smaller renewable energy projects. While these projects may be technically viable, traditional project finance is often structured around larger developments.

Projects supported through the program are expected to progress towards construction in 2027.

Which projects will the program support?

The program will primarily target projects with capacity of up to 5 MW, although larger projects may also be considered where appropriate.

Potential projects include:

These projects occupy what the government describes as the “missing middle” between household rooftop solar and major utility-scale renewable energy developments.

They may be large enough to supply renewable electricity or grid services to local businesses and communities, while remaining small enough to connect to existing electricity distribution infrastructure.

Why distribution-connected projects matter

Connecting renewable energy projects to existing distribution networks can, in some circumstances, allow them to be developed more quickly than projects that depend on major new transmission infrastructure.

The government says the program will help make better use of existing poles, wires and network capacity, allowing additional renewable generation and storage to connect at a potentially lower cost and within a shorter timeframe.

The projects may also strengthen local electricity networks by adding generation and storage closer to the businesses and communities that use the energy.

Actual connection costs, timeframes and project viability will continue to depend on factors including local network capacity, technical requirements, approvals and individual project economics.

What the funding means for renewable energy developers

For developers, sponsors and investors, the program may provide a new debt-financing pathway for projects that are ready to proceed but are considered too small for conventional project finance.

Access to concessional senior debt could help eligible projects address funding gaps, reach financial close and move into construction.

However, the announcement does not mean that every distribution-connected renewable energy project will receive funding. Applicants will need to participate in Infradebt’s competitive selection process and demonstrate that their projects satisfy the relevant technical, commercial and delivery requirements.

The new $100 million program builds on an earlier $150 million CEFC commitment to Infradebt.

According to the government, Infradebt has financed more than 80 infrastructure projects over the past 13 years, including more than 40 distribution-connected renewable energy projects.

How certificates and incentives may affect project economics

Debt finance is only one component of a renewable energy project’s business case.

Depending on the project’s technology, location, size and operating model, environmental certificates or government incentive schemes may also contribute to project revenue or reduce the effective capital cost.

For battery developers and asset owners, Northmore Gordon’s Battery Storage Certificates guide outlines certificate opportunities that may be available for eligible battery energy storage systems.

In New South Wales, eligible battery projects may be able to create Peak Reduction Certificates under the Peak Demand Reduction Scheme. The applicable pathway depends on factors including the battery’s capacity, installation date, site type, network area, solar configuration and the relevant BESS activity.

The new NSW BESS3BESS3: battery systems for eligible apartment buildings, BESS4BESS4: battery systems for eligible small and medium business sites and BESS5BESS5: larger battery systems for eligible commercial and industrial sites activities are due to commence on 1 September 2026, covering eligible apartment, small and medium business, and larger commercial and industrial battery projects.

In addition, the Federal Government has announced that solar systems up to 1MW will be eligible for STCsSmall-scale Technology Certificate under the Australian Renewable Energy Target. More (small-technology certificates) under the SRET, further strengthening the economics for these mid-scale renewable energy projects.

Developers should assess certificate eligibility before finalising equipment, project design or funding arrangements, as these decisions may affect the number and type of certificates a project can create.

It is also important to distinguish the federal financing program from state-based certificate schemes. Receiving finance through the Distribution Connected Accelerator Program would not automatically make a project eligible for certificates or rebates.

Opportunities for commercial solar projects

Victorian commercial solar developers may also need to consider whether their projects qualify under the Victorian Energy Upgrades program.

Northmore Gordon’s article, Earn More from C&I Solar – What Activity 47 Means for You, explains the certificate pathway for eligible commercial and industrial solar installations.

Activity 47 enables upfront deemed Victorian Energy Efficiency Certificates to be created for eligible solar photovoltaic systems between 30 kW and 200 kW.

Larger Victorian solar systems may be able to access other measurement and verification pathways, depending on their size and circumstances.

These certificate pathways are separate from the new federal financing program, but they may be relevant when developers assess the overall economics of eligible solar and hybrid projects.

What prospective applicants should do next

Developers, sponsors and investors with grid-ready renewable energy projects should monitor the detailed application and eligibility requirements released by Infradebt.

Before applying, project proponents should be prepared to demonstrate:

Certificate eligibility and government funding should be assessed early in the development process. Project proponents should also confirm whether accepting one form of government support could affect access to another program.

The Distribution Connected Accelerator Program creates a potential new financing pathway for grid-ready solar, battery and hybrid renewable energy projects.

Developers and asset owners should consider the financing program alongside available environmental certificates, state-based incentives and other project revenue streams.

Northmore Gordon can assist with assessing renewable energy and battery projects, identifying applicable certificate opportunities and incorporating available incentives into the project business case.

Official source: Australian Government – Minister for Climate Change and Energy: $100 million to fast track grid-ready renewable energy projects, published 3 August 2026.

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