I’ve always been asked whether solar panels are “worth it” and now I often get the same question directed to battery storage systems. There is no one answer as “worth it” is down to the individual and their definition of worth. In short, if you’re looking for a solid financial investment then batteries probably aren’t for you. However, if your focus is more ecological and you would like to feel good about using more of your clean, generated electricity then you may conclude that it is indeed worth fitting battery storage to your system.
Most owners of solar photovoltaic systems in homes tend to use around 40% of their generated electricity, with the remainder being exported to the electricity network. In the case of a typical 4kWp solar PV system which generates around 3300 units of electricity per year, the exported electricity amounts to around 2000 units per year. Let’s assume that we could store all of this electricity rather than let it be exported (i.e. 100% self-consumption of the solar electricity). If the price of your electricity is 15p per unit, you’ll be saving £300 per year on your bill by installing a battery storage system.
The trouble is, you won’t be able to store all of the surplus electricity. There will be days in the summer when your PV system generates well over 20 units of electricity. Your daily usage at that time of year will probably be less than this so your battery will rapidly be up to 100% charge and then your home will be exporting electricity. Assuming you choose a battery with sufficient storage capacity it’s more realistic to assume a figure of 80% self-consumption, which means that your electricity savings will be well below £300. Many of the cheaper battery storage options are only around 2kWh in capacity in which case self-consumption would be significantly lower than 80%.
A good quality battery storage system will cost around £4000 with a 5.6kWh battery (including installation). Our flagship product, the Tesla Powerwall 2 offers 13.5kWh of storage at a cost of £8200 fitted. You can see that the return on investment (ROI) of a self-consumption battery system is well in excess of ten years.
You could choose a system which allows you to charge the battery directly from mains electricity. This would allow you to use a multi-rate electricity tariff such as Economy 7, or Agile Octopus (read more about this in our blog) which would improve the ROI of your system. The mathematics of this are much more complicated as it does depend heavily on the size of battery, its rate of charge and discharge, the electricity tariff rates and your demand.