Should You Buy Solar Batteries?
‘Are solar batteries worth it?‘ is a question that I’m being asked more and more.
Before I dive into the issue of energy storage, it is essential to understand that there are two types of solar battery storage setups that you can choose for your home:
Off-grid systems mean precisely that – your property is not connected to the electricity grid. A full 100% of your electricity is generated by your solar panels (well, unless you need to use a diesel generator as backup), and is stored in batteries for use at night. Your property is its own electricity-self-sufficient ‘island’. No meter. No electricity bills.
Note that off-grid setups are expensive – you are looking at $30,000 upwards. This is why most off-grid solar owners live in rural and remote areas where connecting to the distant grid can cost tens of thousands of dollars. In these situations, it can be economically viable to invest in an excellent quality off-grid solar system instead.
But as I explain in another post, off-grid systems make absolutely no economic sense for most suburban Australians. So, from here on in, I’ll talk about batteries in the context of on-grid solar + battery systems.
On-grid Solar + Battery Systems (also called ‘hybrid solar’) are setups where your property is connected to the electricity grid. However, on-grid solar + battery systems will prioritise using stored electricity in your batteries over electricity from the grid – because it’s much cheaper to use electricity you generate yourself instead of paying 35c/kWh (or more) to buy it from the grid!
Even hybrid systems are pretty expensive. I go into more detail about the expected payback periods of hybrid systems here, but adding a decent amount of solar battery storage to your system (about 10kWh worth of good quality lithium-ion batteries) will set you back about $10,000 or more.
Who’s the ideal candidate for an On-Grid Solar + Battery System?
In a nutshell? People who use a lot of electricity and are on a time-of-use tariff.
Battery prices are not yet at the level where it makes economic sense for most Australians on a flat tariff to add energy storage systems to their home. You are typically looking at a payback period of 10 years or more.
To get a better idea of what payback might be in your situation, try our new solar and battery calculator – it’s super-easy and quick to use.
But more Australians are now on time-of-use tariffs with a nasty evening peak from about 4 pm that can cost up to 75c per kilowatt-hour. If this is you, and you will drain your battery every evening you may see a battery payback as low as six years.
But not everyone cares about payback when buying solar batteries. Some people are prepared to spend the money to get their grid imports as low as possible, stick it to the electricity companies and bugger the payback.
For the rest of us, we can expect energy storage to reduce in cost quickly over the next few years. Battery prices are likely to drop drastically as more and more companies enter the marketplace and the underlying technology becomes cheaper to manufacture. In a few years, households may install batteries as often as solar.
In the meantime, you can prepare for energy storage by buying a ‘battery ready’ solar system and reading solar battery reviews.
>> Next: How does solar battery storage work? >>