What BESS3, BESS4 and BESS5 Mean for Commercial Battery Installers in NSW

Three new Peak Demand Reduction Scheme (PDRS) activities commence on 1 September 2026, extending certificate eligibility to apartment buildings, small and medium businesses, and commercial and industrial batteries.

For installers already working in the commercial space, this is the first time these battery sizes have had a dedicated PDRS pathway.

NCBA works exclusively in the NSW scheme market, managing commercial incentives as our core focus.

If you're planning battery jobs that will fall under BESS3, BESS4 or BESS5, here's what you need to know before you quote.

What's New from 1 September 2026

Three activities go live under the PDRS Rule:

BESS3 - Battery Installations in Apartment Buildings BESS4 - Small and Medium Business Batteries BESS5 - Commercial and Industrial Batteries
Name of Activity Install a New Behind the Meter Battery Energy Storage System (apartments) Install a New Business Behind the Meter Battery Energy Storage System (small and medium businesses) Install a New Behind the Meter Energy Storage System (commercial and industrial businesses)
Eligibility Requirements
  1. The Site must be an Apartment Building, comprising not less than four individual dwellings.
  2. There must not be an existing Battery Energy Storage System installed at the same National Metering Identifier(s).
  1. The Site must not be a Residential Building or a Data Centre.
  2. An Implementation of either Activity Definitions BESS4 or BESS5 must not have previously been conducted at the Site.
  1. The End-User Equipment must not be installed in a Residential Building or Data Centre.
  2. An Implementation of either Activity Definitions BESS4 or BESS5 must not have previously been conducted at the Site.
Equipment Requirements
  1. The End-User Equipment must be listed on an approved product list specified by the Scheme Administrator.
  2. The End-User Equipment must have a Usable Battery Capacity greater than 20 kWh and less than or equal to 200 kWh as recorded on the approved product list specified by the Scheme Administrator.
  3. The Usable Battery Capacity of the End-User Equipment must not exceed six times the Battery Inverter Output of the End-User Equipment as recorded on the approved product list specified by the Scheme Administrator.
  4. The End-User Equipment must be internet connectable and controllable by a Demand Response Aggregator.
  5. Each item of End-User Equipment, excluding inverters installed prior to the Implementation Date, must have a warranty of at least 10 years and guarantee that at least seventy percent (70%) of Usable Battery Capacity is retained 10 years from the date the End-User Equipment is installed at the site.
  1. The End-User Equipment must be listed on an approved product list specified by the Scheme Administrator.
  2. The End-User Equipment must have a Usable Battery Capacity greater than 20 kWh and less than or equal to 200 kWh as recorded on the approved product list specified by the Scheme Administrator.
  3. The Usable Battery Capacity must not exceed six times the Battery Inverter Output of the End-User Equipment, as recorded on the approved product list specified by the Scheme Administrator.
  4. The New Solar Photovoltaic Capacity must not be less than a quarter of the Usable Battery Capacity of the End-User Equipment.
  5. The End-User Equipment must be internet connectable and controllable by a Demand Response Aggregator.
  6. Each item of End-User Equipment, excluding inverters installed prior to the Implementation Date, must have a warranty of at least 10 years and guarantee that at least seventy percent (70%) of Usable Battery Capacity is retained 10 years from the date the End-User Equipment is installed at the site.
  1. The End-User Equipment must be tested in accordance with UL9540A.
  2. The End-User Equipment must have a Usable Battery Capacity greater than 200 kWh and less than or equal to 30,000 kWh as recorded in a manner specified by the Scheme Administrator.
  3. The Usable Battery Capacity must not exceed six times the Battery Inverter Output of the End-User Equipment, as recorded in the manner specified by the Scheme Administrator.
  4. The New Solar Photovoltaic Capacity must not be less than a quarter of the Usable Battery Capacity of the End-User Equipment.
  5. The End-User Equipment must be internet connectable and controllable by a Demand Response Aggregator.
Implementation Requirements
  1. The End-User Equipment must be installed outdoors.
  2. The End-User Equipment must be installed Behind the Meter and in accordance with AS/NZS 5139.
  3. The End-User Equipment must be installed by an installer on an approved installer list specified by the Scheme Administrator.
  4. The activity must be performed by a suitably Licensed person in compliance with the relevant standards and legislation.
  5. The installation of the End-User Equipment must have received all required planning and network approvals.
  1. The End-User Equipment must be installed Behind the Meter and in accordance with AS/NZS 5139.
  2. The End-User Equipment must be installed by an installer on an approved installer list specified by the Scheme Administrator.
  3. The activity must be performed by a suitably Licensed person in compliance with the relevant standards and legislation.
  4. The installation of the End-User Equipment must have received all required planning and network approvals.
  5. Where the Battery Energy Storage System is installed indoors in a Class 3 building, a working smoke alarm that meets AS 3786 must be installed in the immediate vicinity.
  1. The End-User Equipment must be installed by a suitably Licensed person in compliance with the relevant standards and legislation.
  2. The installation of the End-User Equipment must have received all required planning and network approvals.
Minimum co-payment $1,000 per implementation $5,000 per implementation Not yet specified — pending consultation

Some detail on BESS5, including exactly how capacity above 10,000 kWh will be recorded, is still subject to consultation. We'll update this page once the Scheme Administrator confirms the final approach.

BESS3: Battery Installations in Apartment Buildings

BESS3 opens certificate eligibility to batteries installed in Class 2 apartment buildings with four or more individual dwellings. Combined usable battery capacity must sit between 20 kWh and 200 kWh, with the battery listed on the Clean Energy Council's approved list and installed outdoors in accordance with AS/NZS 5139.

A minimum co-payment of $1,000 per implementation applies. As with all PDRS activities, the installer must be on the Solar Accreditation Australia list, and the implementation needs all required planning and network approvals in place before certificates can be created. Accredited Certificate Providers (ACPs) or their representatives are required to give the customer a fact sheet with the installation quote.

BESS4: Small and Medium Business Batteries

BESS4 covers batteries installed at small and medium business premises — excluding residential buildings and data centres — with the same 20 kWh–200 kWh combined usable capacity band as BESS3. The minimum payment is higher, at $5,000 per implementation, reflecting the different customer and project profile.

Equipment must be on the CEC's approved battery list, installation must follow AS/NZS 5139, and the same accreditation, approvals and fact sheet requirements apply as under BESS3.

BESS5: Commercial and Industrial Batteries

BESS5 is built for larger-scale batteries: 200 kWh up to 30,000 kWh of combined usable capacity, though the incentive itself only applies to the first 10,000 kWh. Systems must be internet-connectable and controllable by a Demand Response Aggregator, tested to UL9540A, and installed by a suitably licensed person.

BESS5 also brings a new solar PV capacity requirement relative to the battery — a detail worth building into project scoping early, since it changes the shape of a commercial quote compared to a battery-only installation.

Planning battery installations that will fall under BESS3, BESS4 or BESS5?

Call us on (02) 9939 5559 or register your interest below and NCBA will be in touch to help you plan eligible projects ahead of the 1 September 2026 start date

Why Work with us

Three new activities launching at once means three sets of eligibility criteria, product lists and approval pathways to get right.

And getting it wrong at implementation stage can be expensive.

Our experience facilitating incentives in NSW scheme means:

  • Eligibility checked against the current PDRS Rule before you commit to a project, not after

  • Certificate administration handled at scale, so growing commercial volume doesn't become an admin bottleneck

  • A team who knows the compliance requirements for BESS3, BESS4 and BESS5.

If you're scoping commercial or apartment battery jobs for after 1 September, talk to NCBA before you quote.

Fast Payments. Zero Delays

We’re here to keep your cashflow ticking over. We pay you fast and on time, so you can grab the gear you need and keep smashing out installs without missing a beat.

Adaptable and Flexible

When we say bespoke service, we mean it. We work with you to adapt the systems you already have in place.

No Headaches or surprises

We know the Scheme requirements, eligibility and changes, so you don’t have too. Our team, and your dedicated account manager work to protect you so you get no unpleasant surprises.

Frequently Asked Questions

Have a broader question about how the scheme works? See our full NSW Peak Demand Reduction Scheme FAQ.

  • BESS3 is a new PDRS activity commencing 1 September 2026 for batteries installed in apartment buildings (BCA Class 2) with four or more dwellings. Usable capacity must be above 20 kWh and up to 200 kWh, the battery must be internet-connectable and DRA-controllable, and a $1,000 minimum co-payment applies per implementation.

  • BESS4 covers battery installations at small and medium businesses (excluding residential buildings and data centres), with the same 20 kWh–200 kWh capacity range as BESS3, a solar PV sizing requirement, and a $5,000 minimum co-payment per implementation

  • BESS5 applies to commercial and industrial batteries between 200 kWh and 30,000 kWh usable capacity, with the incentive calculated on the first 10,000 kWh. Systems must be internet-connectable, DRA-controllable, and tested to UL9540A.

  • All three activities commence 1 September 2026 under the PDRS Rule.

  • Yes. Installers must be on the Solar Accreditation Australia list for BESS3 and BESS4, and batteries must be on the Scheme Administrator's approved product list (BESS3 and BESS4) or meet UL9540A testing (BESS5). BESS5 requires installation by a suitably licensed person.

For more information: NSW PDRS Rule and changes

Need help on-site or in the office?

We are one

phone call or email away

02 9939 5559