At one end sits utility-scale infrastructure, backed by major underwriting schemes such as the Capacity Investment Scheme (CIS) and grid-scale investment. At the other sits the residential market, where rooftop solar and battery uptake has been turbo-charged by grants, incentives and heavy media attention.
In between sits the commercial and industrial sector.
And once again, it was largely missing from the conversation last night.
While the focus of the 2026 Federal Budget was overwhelmingly on tax reform and cost-of-living measures, the Government did include several clean energy initiatives, particularly around households and large-scale infrastructure.
According to the Smart Energy Council’s initial briefing, these included:
ongoing support for the Cheaper Home Batteries Scheme
$40 million to expand EV charging infrastructure
continued support for EV uptake through the electric car discount
a new National Technical Regulator for rooftop solar, batteries and vehicle-to-grid systems
funding for a national solar panel recycling pilot
more than $500 million aimed at streamlining environmental approvals for major projects.
The Government is also continuing to back the Capacity Investment Scheme (CIS), its primary mechanism for underwriting large-scale renewable generation and storage projects.
Taken together, the direction is clear. Canberra remains heavily focused on utility-scale transition infrastructure and household electrification.
Let’s be clear, this is not an anti-renewables budget. But if you followed the mainstream coverage over the past 24 hours, you could easily come away thinking Australia’s clean energy transition is now largely sorted.
Unfortunately, it isn’t.
Coal exits are approaching fast, transmission projects remain delayed, utility-scale rollout is struggling to move at the pace required, and energy demand continues rising as electrification, EV adoption and AI accelerate.
At the same time, the Government is reportedly winding back parts of its own clean industry agenda, including $1.3 billion in cuts to future solar, battery and hydrogen manufacturing programs.
And despite the scale of Australia’s commercial and industrial energy market, there was again no new federal support aimed at helping businesses accelerate solar, batteries or electrification.
Australian businesses account for the overwhelming majority of our emissions, whether through electricity consumption, transport, manufacturing, buildings, freight or industrial operations.
Australia currently emits well over 430 million tonnes of CO₂-e annually, with commercial buildings alone responsible for approximately 10% of national emissions and around a quarter of the country’s electricity consumption.
Yet the policy mechanisms available to help businesses decarbonise remain fragmented, difficult and comparatively underpowered.
Large-scale Generation Certificates (LGCs) no longer provide the financial boost they once did. Prices, which traded near $90 at their peak, now sit closer to $20–30, meaning they have far less impact on commercial solar affordability.
State-based incentives such as VEECs can deliver value in theory, but in practice are nightmarishly difficult to access and administer.
Meanwhile, the battery rebate was always household-focused, even before its recent scaling back. While it may help some very small businesses, it has never suited the energy needs of most businesses.
At the same time, DNSP processes continue to create friction for commercial projects through connection complexity, export limitations and lengthy approval pathways.
What makes this more frustrating is that the commercial sector is already proving it can move quickly.
Australia installed a record-breaking 1 GW of commercial and industrial solar in 2024, with momentum continuing into 2025.
Unlike many utility-scale projects, commercial solar and storage systems are deployed directly at the point of consumption. They generally avoid the need for new transmission lines and can be delivered far more quickly than large-scale generation projects.
Increasingly, they also integrate batteries, EV charging and demand management systems in ways that reduce pressure on the grid.
As Smart Commercial Energy Managing Director Huon Hoogesteger puts it:
“We’ve built a system that throws heaps of support at households on one side and utility-scale projects on the other, but there’s still very little incentivising Australian businesses to decarbonise, electrify and generate their own power.
Instead, it’s largely been left to our industry and individual businesses to do the heavy lifting, while excessive energy costs punish those who don’t move fast enough.
For businesses, it’s all stick and no carrot.”
What this budget confirms is that Australia understands the value of distributed energy, but mainly through a residential lens.
But commercial and industrial energy infrastructure is distributed energy too.
And in many cases, it delivers larger and faster capacity outcomes than the residential market, with much of that energy naturally consumed during the day while it is being generated, rather than requiring increasingly complex mechanisms to shift it into the evening peak.
Australia’s energy transition will not succeed through a single category of infrastructure. It’s going to take everything we can throw at it: utility-scale renewables, grid-scale storage and transmission investment operating alongside commercial solar, behind-the-meter batteries, electrification and distributed energy systems.
Last night’s budget reinforced a frustrating reality.
The utility-scale end of town continues receiving major structural support. Households continue receiving growing attention as active participants in the energy system.
Meanwhile, commercial and industrial businesses remain the missing middle of Australia’s clean energy transition.