While a solar battery will give you more control over the clean energy you generate, you should also look at how you use power in your home when considering one.
A household with moderate energy usage that invests in solar panel (PV) and a mid-sized battery (around 10kW) can expect to save on average over $1,400 per year, and receive a return on investment over 10 years.
Before contacting a retailer about installing a solar battery, you should first consider the following questions.
How do you use energy in your home?
Do you use energy during the day or does your peak usage happen in the morning before you leave for work and again in the evening when you get home? It is worth considering your own energy usage patterns to determine if a battery can benefit your home. You should also consider your future needs.
Ideally, you would be able to use the energy generated by your system in real time throughout the day. Consuming the power generated by rooftop PV is the best way to save on energy bills.
That said, peak solar generation occurs during the day when many of us are at work, school or out and about. Peak energy usage often comes in the late afternoon or evening (especially in summer) when solar PV is not generating. Timers can help with scheduling the use of appliances during these times, however that is not an option for all households or all appliances.
Batteries give households the option to store the energy generated throughout the day for use in the evenings. Not only does this increase self-consumption, it reduces energy bills as you will be drawing less power from the grid (often during peak tariff times).
Consuming what you create will optimise your savings, however if your system is not producing enough to fully charge your battery each day you also have the option of charging your battery from the grid at a time of the day that aligns with your off-peak energy tariffs. This means you can charge your battery when your rate is the cheapest and use the power in your battery at times of the day when your grid charges may be higher.
Your battery retailer can talk with you about configuring your system to optimise your usage. You should also discuss whether you want the battery to operate in “standalone” mode when you are disconnected from the grid for whatever reason and whether any additional wiring or electrical works may be required.
What system size should you choose?
Choosing the right battery size for your needs will mostly depend on the size of your solar electricity system, how much energy you typically consume overnight and whether you want backup during a power outage. You may also wish to prepare for future energy usage if you are considering purchasing an electric vehicle or upgrading your gas appliances to electric.
To save the most on electricity bills it is generally best to buy a battery that you will regularly charge and discharge to the recommended level. You want to be able to store any excess solar electricity generated each day and ensure that the majority of that stored energy is used later on.
At the same time, it is wise not to overuse a battery, for example by fully charging and discharging two or three times a day. Doing this might shorten its lifespan.
You can usually set this up in an Energy Management System or similar app that helps to optimise the system.
You should also consider any changes you might want to make further down the track, such as switching from gas hot water to an electric heat pump or adding more PV panels to cover the needs of a growing household.
The best way to choose the right battery for your needs and budget is to get an independent assessment from an energy expert, accredited installer or authorised retailer.
What is the installation cost vs expected savings?
Solar battery prices vary depending on the size, quality, and installation location. You can expect to pay approximately $1,500 per kilowatt hour (kWh).
Based on this calculation, a smaller 6kWh battery would cost you approximately $9,000 ($1,500 x 6 = $9,000). The larger the battery, the higher the purchase cost.
Cost vs savings
Batteries can be relatively expensive when compared to the energy bill savings they can deliver and, in many cases, the monthly repayment for a will not be fully offset by the savings made on your energy bills.
While a Solar Victoria interest-free loan will reduce the out-of-pocket costs at the time of installation, the loan repayments are a four-year commitment of up to $183.34 each month.
Adding a battery can enhance your solar bill savings by storing solar-generated electricity for use later in the day, however the monthly interest-free loan repayments may be more than the savings realised each month.
If your main reason for installing a battery is to lower your energy costs, we strongly recommend that you get at least three quotes of roughly the same system size and functionality.
What else should you consider?
Grid-connected solar PV systems, with or without a battery, are designed to switch off during a power outage, to protect those potentially working on nearby electricity lines. Standard solar battery systems also do not provide backup power when the grid fails.
Some solar PV systems can continue to work during a power outage, if they have a battery designed to provide backup power supply. This system disconnects the house from the grid for safety. The ability to provide energy when the grid is down depends not just on the battery, but also the rest of the system design and which inverter is used.
Designing a solar battery system with battery backup is becoming more common, but make sure you tell your installer that’s what you want, so the system can be designed properly with the right components. You may also need wiring or electrical upgrades to allow this function.
Your installer will be able to provide you with more guidance; just make it clear what your requirements are when looking for a system.
Once a battery system is installed, households may want to consider joining an Aggregation program or a VPP (where several rooftop solar panels and battery storage systems are linked) and using smart technology to meet local demand for grid electricity. Many VPP programs offer additional financial incentives as part of their offering.
The benefits of participating in aggregation projects or a VPP program are that you can:
- receive compensation for sharing your stored solar energy with the VPP network
- make the most of the solar power you generate
- balance the supply and demand of energy for fewer disruptions
- reduce network costs for all Victorians
- increase grid resilience
- enable greater uptake of Distributed Energy Resources (DER)
Most aggregation and VPP programs have specific product requirements, so you will need to review these to ensure the system you are installing can participate in your preferred VPP.
There are other ways to get more out of your solar system if a battery isn’t for you just yet.
While a battery allows you to store your solar energy for use at a later time, if you can shift some of your biggest electricity usage to the middle of the day, you can make much better use of the solar energy you generate without the need for a battery.
A good example of this is to use a heat pump hot water system and use a timer to run it in the middle of the day. This allows the hot water system to store the excess solar energy in the form of hot water—effectively making your water heater a form of battery.
The same applies to other loads, such as a heat pump hydronic heating system, which can store solar electricity as heat in a large water tank for use in the evening. Or you can simply shift other loads such as washing machine and dishwasher use to the middle of the day.
While the latter isn’t a form of energy storage, it does make effective use of solar electricity at the time of generation, reducing the need for battery storage. Many appliances have in-built timers making it easier to shift run-times without the need for additional timers.
Reviewed 16 November 2023