Updated: 6 Things you should do before getting a battery

In April last year, we got 7.8kW of solar with a Solar Edge inverter, including consumption monitoring. In November, we got a 9.3kWh LG Chem battery. From this experience, we have learned a lot from the benefits of solar and independently, batteries, and think there is a lot you should do prior to making the leap into batteries. Here are 5 steps I think households should take before getting a battery:

1 – Max out your solar

It is important to remember that batteries do not produce electricity, just store and shift it. On the other hand, solar produces electricity. The electricity can be used to power your household, and export to the grid. While many complain that feed-in-tariffs (10-15 c/kWh) are much less than what you pay for electricity (25-35 c/kWh), they still present a good return for your excess solar. Just on feed-in-tariffs alone, once can expect 8-12% ROI (annual savings/revenue divided by cost of solar installation).

We used to pay around $1,600 per year for electricity. With solar, we were earning around $110 per month in feed-in-tariffs, more than covering the cost of our remaining grid electricity usage, resulting in running at around $700 per year profit. With current high feed-in-tariffs, it is a good time to go big on your solar now to payback a good portion of your system in the next few years. I also wrote a post on 6 reasons to go big on solar.

Feed in tariff credits

This could even mean getting 10kW of solar or more.

2 – Consumption Monitoring

It is important to have a good idea of how much solar you are producing, how much electricity your house is using and when, and how much solar you are using directly (ie. self consumption). Prior to getting a battery, we had shifted loads like hot water heat pump, dish washer and washing machine into solar production times to maximise our solar production. This saw us being 65% solar supplied! And only using 2-4 kWh per day from the grid.

So we knew that getting a 9.3kWh battery was a bit overkill for what we needed. But at least we knew. Without consumption monitoring, we wouldn’t have been in tune with our electricity demand and solar production to become 65% solar supplied, and would not have known what size battery we needed or if we needed one at all.

3 – Hot Water

Like many shire households, we used to have a resistive element hot water tank for out hot water. It was on a controlled load, and produced hot water overnight. We found that it was using 8 kWh per day. This was around half of our daily electricity use!

We now have a hot water heat pump (more details here). This is efficient and uses 2 kWh per day on average. When we got solar, we moved our heat pump production for overnight, to come on at 11am each day. For watching our consumption monitoring, it is powered by solar for pretty much all of the year.

Photo: Heat pump (in blue) operating from 11am

Basically, we are using solar to make our hot water in the middle of the day, then using the hot water when needed. It is effectively an 8 kWh battery.  A new hot water heat pump and tank costs between $2,500 and $4,500 installed, much cheaper than a Tesla Powerwall or LG.

Other than a heat pump, you could also use a timer to make your hot water come on during the day, or use a PV Diverter to power your hot water with solar (around $1,000).

(Sunny Shire has now launched a Hot Water Heat Pump bulk buy – Details here)

4 – LED Lighting

We use lights predominantly at night. If you get a battery, it is wasteful to use up the battery capacity using inefficient lighting. It may mean that you get a bigger (more expensive) battery, or you leave less battery capacity available for back up or other purposes. Efficient lighting like LEDs can use 80-90% less than older lighting technologies.

5 – Electrify and be efficient

It is now possible to meet all your household energy demands efficiently using electricity. This may mean a heat pump for hot water, electric induction stove tops and ovens and efficient reverse cycled air conditioning for heating in winter. This means no more gas bill, and in particular, now more gas connection fixed fees. This saving on gas bills can help your payback on a battery. And even more, you can reach 100% solar supplied!

Rather than investing in a huge or multiple batteries, see what efficiency improvements can be made around heating, cooking and other uses, and see through your consumption monitoring what best battery may suit.

78% Solar powered house for main appliances, no battery

If would like to find out more about how to go all electric efficiently, the My Efficient Electric Home Facebook Group is a great place to get info, hear from others and ask questions. You can also join the Sutherland Shire Solar Group for any solar and battery questions locally.

6 – Get an Electric Vehicle

Electric Vehicles (EV) like Tesla and Hyundai cost more money than Internal Combustion Engine (ICE) cars. So a key question for someone considering a home battery is: would the $10,000 to $14,000 cost of a home battery be better spent making the next car an EV rather than an ICE?

Home batteries are normally between 7 to 13 kWh. Whereas an EV may have 40kWh to 70kWh battery capacity. EVs are effectively a battery on wheels!

So should your home battery come with wheels? We think the money for a home battery is better spent on an EV. You can set it to charge to soak up your solar power during the day, and also eliminate / reduce your fuel bill. Plus, EVs are amazing technology and fun to drive. And just like buying a battery for your home, it puts you as part of support of this new technology and innovation.

Should you get a battery? Here are my thoughts

Update: This article has now been published in various industry publications, linked below

9 Comments

  1. Johnathan
    We got 18 panels installed at our place in Bundeena. Because of our usage, letting the sun heat the hot water between 10 and 3 each day and putting in decent LEDs we got a nice credit from power company last quarter. I am having the same thoughts about probably not needing batteries.
    Cheers
    Bill

    • Another Bundeena resident here. We’re looking into this now. A problem for Bundeena is power outages from storms. We were hoping a battery could help us over these periods when power is suddenly cut. In the past when we’ve had frail elders needing access to power, we had to leave town until the power was back on. If a battery will fill this gap, we’re in.

  2. At this time, it seems that the majority of battery companies are targeting the high-end market, but reality is that most households going through an energy efficiency upgrade only require 2-4kWh batteries.

    With full adoption of LED, heat pumps, and some efficient and well timed appliances (operating during the day), a basic 2-3kWh battery would cover 95% of overnight usage, but a small battery would still be in the $5000-6000 range installed.

    The base-cost of having an installer turning up on-site seems to be approximately $2000-3000, with the 8-10 kWh capacity batteries costing $6000-8000 on top, while a 2-4kWh battery would be $3000-5000.

    A few companies have trivially upgrade-able battery cabinets, but I’ve found that the high cost of entry is prohibitive.

    Somehow, the manufacturers need to stream-line the installation, and lower the entry cost.

    I’d like to see more innovation from the battery manufacturers, and commodification of these batteries.

    “Plug-in” batteries, maybe 0.5-1.0kWh that can just utilise a standard 230V plug would be ideal without having to deal with the hefty installation costs. People could just buy a few and plug them into the garage outlets.

    • I live in the US (Maine) and looked into battery,primarily for backup during outages. But I found both LG and Powerwall to be extremely expensive, about $12,000 and $14,000, respectively. Moreover, neither could be charged with a generator, which we need for long periods with no sun or snow covering our roof mounted solar panels.

  3. I’m offgrid with only 1.5kw of solar and 6kwh of agm batteries which should only be cycled to 50%, so call it a 3kwh system. (usable storage)
    I understand that most people need a bigger system than mine to power their dishwashers and air conditioners and my system can’t do that, but at around $3500 total, I’m happy with it.
    The point I want to make is that the batteries for my little system cost me less than $1000, which seems far cheaper than the prices being quoted here.

    • Hi Col, amazing you have gone offgrid with solar and batteries. Yes, I think older style technologies of batteries are cheaper. So for those that have some ingenuity, willingness to research and find a local installer familiar with the technology, there are ways it can be done cheaper. Modern Lithium ion batteries are attractive as they come with warranties etc and are happily installed by the many solar companies out there

  4. At 70 years old and on the pension, for me the cost of installing batteries is prohibitive at the moment. It would take years before I could break even let alone come out ahead.

  5. We are currently about to get a solar system for our house. We have electric hot water tank with off peak water heating. Is it not better to get the credit from the solar during the day and to pay for the hot water heater during the evening at the lower electricity rate with off peak? During the winter when the solar credits would be lower doesn’t it make sense to keep the hot water on the off peak night rate?

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