Discover the long-term savings of domestic battery storage and flexible tariffs without solar panels. The savings are stacking up with battery prices at an all-time low in 2024!
With access to growing number of flexible tariffs and cheaper-than-ever batteries in 2024, battery storage without solar is an amazing investment option. Learn how to leverage flexible tariffs, save on your bills, help the grid and set yourself up for future upgrades.
Domestic Battery ROI Calculator
System Cost (battery + hybrid inverter + installation)Daily Consumption (kWh)Battery Size (kWh)High Price (per kWh)Low Price (per kWh)Calculate
Additionally, discover even more immediate benefits to installing such a system and treating it as an upgrade to your home and standard of living.
Is it Worth Getting Battery Storage Without Solar?
Yes, there is a financial case in favour of this decision. The economic benefits will vary depending on tariffs and energy prices.
I will work through a couple of examples to demonstrate the potential benefits. Please note that I keep the calculations conservative, striving to provide a realistic estimate.
Utility companies in the UK offer flexible tariffs, such as Economy Seven or Agile tariffs. These tariffs charge discounted prices during certain times of the day or night.
Thus, energy usage should be encouraged when there is excess electricity production, which helps balance the electrical grid.
You can leverage the discount cost periods by charging a battery and using the stored energy later to save money. Let’s go through an example to see the case for investing in battery storage and an inverter without solar panels.
Financial Risks and Contingencies
Before jumping into the details, it is essential to acknowledge that there are risks. While the financial benefits are promising, it’s crucial to consider the long-term commitment and potential changes in circumstances. Two key factors take the main stage:
- Energy prices can fluctuate, affecting your savings.
- Batteries degrade over time, reducing their storage capacity.
Example Calculation Initial Data
I am using a modified version at 10kWh of the Fogstar 15kWh 48V Battery Bundle in this calculation.
The cycle life of the batteries used in the example is 4,000 Cycles at 1C to 80%. (Fogstar suggests that after 4000 cycles, you will still have a battery that can deliver 80% of the stated capacity) 5.12kWh is fully usable from each of the batteries in the rack.
I will use the prices from retail suppliers and domestic tariffs on the UK market.
Home details:
Home consumption: 12kWh for 24h ( the medium consumption in UK households is just under 8kWh; I am considering the typical high consumption case of just under 12kWh. Source Octopus Energy’s quote calculator )
Peak electricity consumption: 3.6 kWh
Price of the system:
- Inverter: Sunsynk 3.6 ECCO £759
- New AC breaker from a qualified electrician: £240
- Battery storage: 10.24kWh 2x Fogstar 5.12kWh LifePO4 Battery £2100
- The rest of the labour – DIY
Total: 3099 ( rounded )
The Economy Seven Tariff Case
Energy tariff Octopus Energy’s Economy Seven:
- Unit rate (day) 33.76 p/kWh
- Unit rate (night) 14.99 p/kWh
| Savings breakdown | ||
|---|---|---|
| kWh price difference | 33.76 p/kWh – 14.99 p/kWh | 18.77 p/kWh |
| kWh stored and used per day | 80% of 10.24kWh | 8.19 kWh |
| Savings per day | 8.19 kWh x 18.77 p/kWh | £1.53 |
| Break-even days | £3099 / £1.53 | 2015 (5 years 6 months) |
| Savings at 4000 cycles | 4000 days x £1.53 | £6150.55 |
| Cost of consumption of night-rate energy | ||
|---|---|---|
| Daily consumption | 8.19 kWh | |
| Price per day | 8.19 kWh x 14.99 p/kWh | £1.22 |
| Cost at 4000 cycles | 4000 days x £1.22 | £4911.92 |
| Cost of remaining consumption | ||
|---|---|---|
| Daily consumption | 12kWh – 8.19 kWh | 3.8kWh |
| Price per day at day rate | 3.8kWh x 33.76 p/kWh | £1.28 |
| Price per day at night rate | 3.8kWh x 14.99 p/kWh | £0.57 |
| Cost at 4000cycles at day rate | 4000days x £1.28 | £5142.32 |
| Cost at 4000cycles at night rate | 4000days x £0.57 | £2283.27 |
Day-rate Supplement Case
Total cost for 4000days if supplementing at day rate = (Cost of consumption of night-rate energy) + (Cost of remaining consumption at day rate)
| Total Costs | ||
|---|---|---|
| Cost of energy | £4911.92 + £5142.32 | £10054.24 |
| Cost of energy + system | £10054.24 + £3099 | £13153.24 |
Night-rate Supplement Case
Total cost for 4000days if supplementing at night rate = (Cost of consumption of night-rate energy) + (Cost of remaining consumption at night rate)
| Total Costs | ||
|---|---|---|
| Cost of energy | £4911.92 + £2283.27 | £7195.2 |
| Cost of energy + system | £7195.2 + £3099 | £10294.2 |
Let’s Compare to not Buying an Economy Seven Tariff:
Energy tariff Octopus Energy’s Smart (non-Economy-Seven ):
Unit rate 0.26 p/kWh
Total without Economy Seven and batteries = 4000days x 12kWh x 0.26 p/kWh = £12888
End Result For This Comparison
We get £12888 – £10294.2 = £2593.79 benefit.
These numbers say that within the first 4000 cycles of the battery, we save £2593.79 if the battery completely offsets the usage of day-rate electricity. This is positive, but we must be mindful of how significantly long this period is, just under 11 years.
The Agile Tariff Case
Energy tariff Octopus Energy’s Agile Tariff:
As we can see, the Agile tariff has peak and low daily usage prices. A large enough battery capacity will allow you to make the most of this fantastic tariff.
For this case, I will take the average price of the cheapest 6 hours as the lowest price you can use to charge your batteries. The higher prices in the comparison will be the average daily price. I will ignore the most expensive 6 hours because we will offset them with electricity from the battery.
- Unit rate (higher rate) 20.01 p/kWh
- Unit rate (low rate) 13.68 p/kWh
| Savings breakdown | ||
|---|---|---|
| kWh price difference | 20.01 p/kWh – 13.68 p/kWh | 6.329999999999999 p/kWh |
| kWh stored and used per day | 80% of 10.24kWh | 8.19 kWh |
| Savings per day | 8.19 kWh x 6.329999999999999 p/kWh | £0.51 |
| Break-even days | £3099 / £0.51 | 5976 (16 years 4 months) |
| Savings at 4000 cycles | 4000 days x £0.51 | £2074.21 |
| Cost of consumption of lower-rate energy | ||
|---|---|---|
| Daily consumption | 8.19 kWh | |
| Price per day | 8.19 kWh x 13.68 p/kWh | £1.12 |
| Cost at 4000 cycles | 4000 days x £1.12 | £4482.66 |
| Cost of remaining consumption | ||
|---|---|---|
| Daily consumption | 12kWh – 8.19 kWh | 3.8kWh |
| Price per day at the higher rate | 3.8kWh x 20.01 p/kWh | £0.76 |
| Price per day at the lower rate | 3.8kWh x 13.68 p/kWh | £0.52 |
| Cost at 4000cycles at the higher rate | 4000days x £0.76 | £3047.92 |
| Cost at 4000cycles at the lower rate | 4000days x £0.52 | £2083.73 |
Higher-Rate Supplement Case
Total cost for 4000days if supplementing at the higher rate = (Cost of consumption of night-rate energy) + (Cost of remaining consumption at the higher rate)
| Total Costs | ||
|---|---|---|
| Cost of energy | £4482.66 + £3047.92 | £7530.58 |
| Cost of energy + system | £7530.58 + £3099 | £10629.58 |
Lower-Rate Supplement Case
Total cost for 4000days if supplementing at the lower rate = (Cost of consumption of night-rate energy) + (Cost of remaining consumption at the lower rate)
| Total Costs | ||
|---|---|---|
| Cost of energy | £4482.66 + £2083.73 | £6566.4 |
| Cost of energy + system | £6566.4 + £3099 | £9665.4 |
Let’s Compare to not Buying an Agile Tariff:
Energy tariff Octopus Energy’s Smart (non-Economy-Seven ):
Unit rate 0.26 p/kWh
Total without Economy Seven and batteries = 4000days x 12kWh x 0.26 p/kWh = £12888
End Result For Agile Tariff Savings Calculation
We get £12888 – £9665.4 = £3222.6 benefit.
These numbers say that within the first 4000cycles of the battery, we can save £3222.6 if the battery completely offsets the usage of higher-rate electricity.
Please keep in mind that this is a conservative comparison. In the periods I examined, there were 30-minute time slots where Octopus Energy pays you to take energy off the grid. You cannot rely on this daily, but this calculation completely ignores it, thus leaving room for contingency costs or higher-than-anticipated prices. With some automation, reliable battery setup and a favourable duration of low prices, you could comfortably pay single-digit prices on all the electricity stored in your battery.
What is the Best Electricity Tariff for Battery Storage
Clearly, the Agile Tariff is the better choice. Depending on how fast you can charge your batteries, you can push your average price even lower. On top of that, this tariff offers a flexible export price too.
With a larger battery, you can earn some income and help offset the cost further. Finally, there is a healthy variety of options for automating the charge and discharge of your battery. With some automation, you can maximise this tariff, making it highly appealing.
Economic Case Conclusion
The calculations do not include any contingency funds for repairs or faults. On the other hand, energy prices fluctuate over time based on various factors, from global economic conditions to local energy policies. If energy prices rise significantly over the next 11 years, the savings from using a battery could be more significant. Conversely, if prices drop, the savings might be less. It’s always advisable to monitor energy trends and adjust your calculations accordingly.
What are the Disadvantages of Battery Storage?
As with anything else, there are drawbacks. The key to identifying their effect is the circumstances of your system. Some circumstances will pronounce specific drawbacks, whereas others will mitigate them. The following are three essential drawbacks to consider.
Battery Performance Degrades Over Time
Most batteries lose capacity over prolonged use, meaning they might store less energy in their later life stages. In conjunction with the cycle life, it is essential to consider the potential degradation of the battery over time.
Losses in Charging and Discharging
Converting electricity from AC to DC when charging the battery, and DC to AC for your home incurs losses. As found by this paper in the Journal of Energy Storage, the round trip efficiency quoted in various other papers puts Li-ion batteries at 78%-98% or 87.37% on average.
Factor this loss into your financial calculations. You should reconsider if they don’t make sense at 90% efficiency.
You Don’t Have a Suitable Space to Store the Battery
Lithium-based batteries’ performance and longevity is strongly influenced by their temperature. As stated by a study on battery degradation by the University of Missouri-Columbia :
A battery operated at 30°C has a reduced cycle life by 20%. At 45°C, the battery only has half of its optimal lifetime, which can be achieved when operating at 20°C
From this, they suggest that:
A temperature of 20°C or slightly below is recommended for Li-ion batteries to achieve optimum service life.
This means that if you plan to store the battery outdoors, some shelter from the elements will be required to retain its longevity.
Reasons to Install a Battery Without Solar
The cost-benefit from the above use case requires significant time to materialise and increases the risk of it not materialising. What other reasons exist beyond the bare minimum case for financial benefit? Considerations for future expansions and practical applications of a battery may add to the economic aspect or outright take the lead as a number one reason to go the battery without solar way.
A Battery Can Supply Your Home in Case of a Power Outage
A hybrid inverter can use the battery as a backup power source in case of a power outage from the grid. Many hybrid inverters offer this feature and can work with various batteries, giving you flexibility in procuring and implementing your system.
There are also packaged solutions, such as the Tesla Powerwall, which include the batteries, the inverter and all the logic components to serve as backup storage or an intelligent energy management system. These are known as AC batteries; for equivalent storage capacity, AC batteries tend to be more expensive than the alternative. However, customers get a more seamless experience for the premium price, and importantly, their warranty is with the same company.
Hedge Against Energy Price Hikes and Make Money From Flexible Tariffs
Owning a battery enables you to use cheaper energy when it is available. Some utility companies have flexible tariffs with spot price changes that allow you to get paid for taking energy off the grid. Such tariffs are aimed at electric vehicle (EV) owners, but domestic battery storage will benefit you, too.
Can I Install a Battery First and Add Solar Later?
Yes, in fact, buying the battery and the inverter is a stepping stone, a large one, too. They are likely the top two most expensive single items in a home solar energy system.
The good news is that this early investment is future-proof. Adding solar power is relatively easy with a battery and an inverter in place. So, at this early stage, the most important decision is to pick a feature-rich hybrid inverter that can take input from both solar panels and a battery. Most hybrid inverters are, so you have a comfortable array of options to choose from.
Why Add Solar When You Already Have a Battery?
At this point, solar power will be an extremely low-cost addition to your system. Installing the inverter and the battery would have taken the larger cost of the system out of this equation.
Solar panels are cheaper than ever before, and the trend of their prices is steadily downward. For example 410W panels’ price is about £56.74 each in 2024. Panels come with guaranteed performance for upwards of 20 years, which means the cost of a unit of energy they provide will keep decreasing for a long time.
What Does Battery Storage Without Panels Look Like in Practice?
What Components Do I Need For Energy Storage Without Solar?
For a battery to serve as a domestic energy storage and source, you will need a battery and an inverter.
The battery is connected to the inverter with a cable for each pole, positive and negative. Between the inverter and the battery, you need an isolator switch. This is not mandatory but improves the system’s safety and maintainability. Please note this is a DC isolator; they are not the same as AC isolators.
You will need an inverter with a built-in BMS. Technically, you could opt for a more streamlined inverter and a separate charge controller, but that adds extra overhead. Your inverter should also include smart features that automate switching between charging and discharging periods.
The inverter also needs to be connected to your circuit board, also known as the consumer unit. A dedicated circuit is advisable for the inverter protected by a suitable RCBO. An isolator is placed between the RCBO and the inverter, again for safety and maintainability.
Finally, you need to place stickers on your consumer unit, denoting that it is now a dual supply system.
Where do I Start?
Start by identifying a few crucial requirements and constraints. You will need these to decide what equipment to select to match them best.
- How much electricity do you use for 24 hours?
- Do you have a suitable space to place the battery and the inverter?
- Is your inverter and battery space close enough to the consumer unit?
- Are you going to install solar panels later?
- Secure the funds for the system. These systems are all paid upfront and return the investment in savings.
- Are you planning to export energy to the grid in the future?
Make Decisions Based on Your Findings.
Consumption
You need a battery big enough to cover your home’s consumption.
Remember that your consumption will fluctuate, so choose a comfortable value.
Equally important, the battery you select needs to cover your home’s consumption within 80% of its rated storage.
After identifying these, you must calculate if the investment still makes sense. For example, the more energy you need, the stronger the economic case will be.
Space and Dimensions
Batteries are bulky; for example, the 15kWh battery I used in the example is housed in a rack 600 x 625 x 800mm.
Additionally, you will need a space for the inverter nearby. Inverters require ample space around them to allow for cooling off. The cables running from the battery to the inverter are thick and costly to purchase. Increasing their distance will require even thicker cables, which will inflate the cost of your system and increase your risk exposure.
The space you choose also needs to protect your equipment from the elements. So, if you plan to install outdoors, you must factor in additional costs for cabinets or shelters.
Distance Between Your Inverter and Consumer Unit
The inverter connects to your consumer unit using an AC cable, which is easy to manage at almost any distance in a domestic setting. However, your inverter must also know how much energy your home uses. For this, it needs to connect to a meter or a Current Transformer (CT) Clamp that monitors your home’s energy consumption from the grid. The CT Clamp wraps around the line leading to your consumer unit or electricity meter. The metering equipment’s connections are challenging at larger distances.
Are You Going to Install Solar Later?
This is another distance constraint. The solar panels are wired to the inverter with cables carrying DC. Transporting DC is a liability; the best way to mitigate the risks is to reduce the distance it needs to travel. Therefore, you must place your inverter close to your panels.
Secure the Funding
These systems are costly, and homeowners cannot rely on grants or special credits in the UK to install them. You will need to pay for the system up-front.
Are You Planning to Export Energy to the Grid in the Future
If this is the case, you are best placed to hire an MCS-certified installer, who will issue you an MCS certificate for the system. These certificates are required by utility companies when signing up for the Smart Export Guarantee rates for exporting energy.
Conclusion
This examination delved into the financial and practical aspects of employing a battery storage system without solar panels in a UK household. Utilising flexible Tariffs, we established that over the span of 4000 cycles (~11 years), you could realise a net benefit from £2593.79 to £3222.6 by offsetting day-rate electricity usage. Moreover, a battery system poses as a robust backup during power outages. It paves the way for an easier transition to solar if chosen later.
Although the upfront costs are hefty and the ROI period isn’t short, the long-term savings render this venture worthy of consideration. Even more so considering potential energy price hikes and the convenience of uninterrupted power supply. The added potential of seamlessly integrating solar power at a lowered cost makes this arrangement a financially prudent choice and a step towards a self-sustainable energy future.
Considering a battery purchase and wondering which one to choose? See our recommended battery, the best solar battery in the UK.
