Does Battery Storage Work?

Battery storage can be a viable energy strategy for those with Solar Panels and anyone who enjoys the benefit of a variable electricity tariff such as Economy 7.

Modern storage batteries offer long-term performance and reliability given the advances in technology and this helps to make them an increasingly popular energy strategy for homeowners. Current storage batteries are mostly made using Lithium metal which is a hard wearing and efficient energy storage material. 

Storage batteries are reasonably simple to install and require very little in the way of enabling works but during a feasibility assessment, our technical representative will assess the age of the consumer unit and whether any pre-installation remedials are required. During the installation of energy storage batteries, our team will install an inverter to manage the battery being charged and discharged through the conversion of DC power from the grid into AC useable power and vice versa.

Generally, batteries will be located close to the consumer unit in a cupboard, plant room or utility room to reduce the cabling required between the two interfaces. When considering battery storage, the units are about the size of a small suitcase and will weigh approximately 20-30 Kilos per module. Larger battery systems can be the size of a washing machine; therefore, you should consider whether you have the space available for committing to such an installation.

To demonstrate the viability of battery storage, let’s assume you have a four-bedroom, detached house with four occupants and annual energy usage of 8000 kWh. If you are on a variable or Economy 7 electricity tariff, you might expect to pay around 45 pence per kWh during the day and 10 pence kWh hours at night. Based on the 8000 kWh hours of annual electricity usage, this equates to 22 kWh per day. Generally, the home will consume 80% of its energy outside of the Economy 7 or variable tariff hours which means 4.4 kWh are used at a rate of 10 pence per kWh at night and the remaining 17.6 kWh will be used during the day/evening at a rate of 45 pence per kWh. 

If you had a battery storage system at 18 kWh in size, you could fully charge it during the night at a rate of 10 pence per kWh compared to 45 pence per kWh during the day. When your tariff switches to day rate, rather than draw the energy demand from the grid, you can prioritise load from the battery to power the home, therefore, saving you 35 pence per kWh. Over the course of a year, this could save £2,240 in electricity costs. With battery storage warrantied for 10 years and expected to last at least 15 years, you might expect to achieve a pay back of less than 5 years against an initial investment of £8,075. Before future inflation on energy costs is considered, from year 5 onwards, your initial investment will yield dividends and could save you a fortune!

Of course, some homeowners look towards battery storage to hedge against the risk of power cuts driven from storms or supply chain uncertainty but from our perspective, battery storage could be viewed as an investment from which you will achieve a return. Battery storage is almost a necessity when it comes to having Solar Panels installed given that excess generation from the PV array will be lost to the grid where you might expect to receive, at best, 7 pence per kWh back from your energy supplier under the Smart Export Guarantee.

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