US Home Battery Market Holds as Residential Solar Faces Steepest Drop Since 2020
BNEF expects US rooftop solar installations to hit a six-year low while battery uptake proves more resilient, diverging from the same incentive shock.
US home battery installations kept rising even after federal incentives for consumer clean energy lapsed last autumn (2025), Canary Media reported on August 14 (2026-08-14), a trajectory separating the storage market from the broader rooftop solar industry, where the policy withdrawal is landing harder.7
Bloomberg NEF now expects US residential solar installations to fall to their lowest level since 2020 this year. The drop follows President Trump's One Big Beautiful Bill Act, signed approximately one year ago, which eliminated the 30% federal investment tax credit for both rooftop solar and the battery backup systems homeowners increasingly pair with panels. Demand pulled forward ahead of that deadline is now showing up as an absence in current installation runs.7,3
The backdrop has not made the underlying economics of storage any easier to overlook. ICE Brent crude front-month traded at $95.26 a barrel on September 2 (2026-09-02), kept elevated by Strait of Hormuz supply constraints. OilPrice.com noted in June (2026-06-13) that higher energy bills worldwide, driven in part by those restrictions, had prompted a surge in interest in household solar and battery systems. An analysis cited in that piece estimated solar power saved Europe more than $115 million a day in March by reducing gas imports, a figure that could reach $78 billion by year-end if the strait remains closed.2
State-level data make the national solar decline look less uniform than the headline number suggests. California's residential solar market is on course to grow 17% this year versus last, Canary Media's June (2026-06-19) reporting found, while the country's second-largest rooftop solar state is tracking 62% growth in 2026. The incentive loss bites, but not everywhere equally.3
Australia offers the clearest available picture of where distributed storage penetration leads over time. Rooftop solar now covers 40% of Australian homes, totalling 28.3 GW — more than the country's entire coal fleet — according to Utility Dive reporting from July (2026-07-13). One Australian homeowner profiled in that piece received a bill credit exceeding A$700 ($500 USD), operating a combined solar, battery, and electric vehicle system that sold flexibility back to the grid. Government-backed entities are filling gaps the private market has not yet reached: State Electricity Commission CEO Chris Miller told a RenewEconomy podcast in June (2026-06-12) that his agency was active across the renewables transition, from home electrification to deep storage.5,1
The grid-level consequences of that penetration are already visible in Australian pricing data. Batteries "increasingly reduced reliance on gas and hydro generation during evening peaks, contributing to lower year-on-year wholesale prices," according to SMH reporting from April (2026-04-29). Any US grid operator confronting residential storage at scale will face the same evening-peak compression eventually; the US timeline has simply moved later.6
One market the boom has largely bypassed in both countries is apartments. Allume Energy co-founder and CEO Cameron Knox, speaking to RenewEconomy in an interview published on June 23 (2026-06-23), described the technical, legal, and governance barriers keeping apartment residents outside the standard rooftop solar and battery installer model. Millions of renters and condominium owners live in buildings where neither product deploys cleanly, and headline penetration figures omit this population entirely.4
For traders and installers tracking the residential storage supply chain, battery attachment rates — what share of new solar installs come paired with storage — are the figure worth watching. BNEF's residential solar volume forecast marks the floor. Those attachment rates will show whether batteries have genuinely decoupled from the solar incentive cycle or are still riding a lagged echo of the same pull-forward trade.7