Less than a year ago, in August 2023, we installed a 4.8kWh Solar Battery at a cost of £2,900. Whenever I talk about the upfront capital costs of solar power, people rightly want to know what the payback period is.
Well, after less than 10 months, the battery has given us 1MWh.
To put that in to context, the average UK household uses about 3MWh per year. So (again, very roughly) over a third of our electricity use this year has come from the battery.
But where does the battery get its energy from? We have two sources.
First is solar. When the sun is shining, our solar panels produce electricity. That flows down from our roof and into our mains wiring where it is used by the home. If we are using less electricity than is being produced, the electricity flows into the local grid and we get paid for selling our surplus.
Our battery has sensors attached to the grid connection. When it detects surplus generation, it starts charging. By constantly monitoring our overproduction, it can charge up with free solar power.
But the sun doesn't always shine (ain't that the truth!) so there are days when our solar production is less than our usage.
In these cases, the battery charges from the electricity grid. We have a smart tariff which changes price every 30 minutes. The battery knows the day's prices and can predict our daily usage. If it can see that electricity is cheap at 3am and expensive at 4pm, then it will charge up during the early hours of the day and discharge at peak time.
The battery occasionally sits idle. Mostly when it has fully charged but knows an expensive period is coming up later.
What does that mean for money?
Well... it's complicated! When the battery charges from solar, is the electricity free? No! If we were to sell that surplus electricity to the grid, we would be paid 15p/kWh.
When the battery charges from the grid, is the electricity expensive? No! Because we are on a dynamic tariff, we occasionally get paid to use electricity! Our provider has paid us up to 5p/kWh to charge!
When the battery discharges, how much does it save us? Again, complicated! Because we're on a dynamic tariff our prices change every 30 minutes. Sometimes the rates are as high as £1/kWh, other times they're 1p/kWh. Generally speaking, the battery only discharges if the price of use is higher than the cost of acquisition.
So... I've fudged the figures! For the first year of operation, energy prices have been high. Based on a back-of-a-fag-packet calculation, I reckon the battery saves us an average of about 31p/kWh. Call it about £360 per year in savings.
That gives us a payback time of about 8 years.
Of course, if electricity prices spike, payback will be quicker. If they crater, it'll take longer. If we switch to electrical heating or get an electric car, the savings will be greater.
Domestic battery technology is still a bit of a tough sell. The batteries are large and their fans are noisy. The cost of materials and installation is high and their capacity is relatively small. But the technology behind them is sound. With a dynamic energy price tariff, they're one of the best way to reduce utility bills.