Solar systems are fairly commonplace on Australian homes, with over 30% of homes adopting the technology. The remaining 70% either have chosen not to adopt solar yet, or they simply can’t. High-rise apartment buildings, units with minimal roof space, and homes with rooftop restrictions are often overlooked in the solar equation. With most Australians looking to save on their electricity bills, is battery storage without solar a feasible option? Let’s find out.
How battery storage works WITH solar
A typical solar and battery storage setup will comprise:
- Rooftop solar panels
- Solar inverter (hybrid or with an additional battery inverter)
- Battery (DC or AC-coupled)
Your battery will be charged by the solar panels during the day for discharge during the night, on cloudy days, or during power outages. Excess electricity stored can be exported to the grid for a feed-in tariff (FiT) or during VPP events, if your home participates in a virtual power plant (VPP). In many cases, you can set up your battery to charge directly from the grid during off-peak hours to supplement solar power storage.
Homes looking to go completely off-grid will not be able to charge their battery from the grid.
How battery storage works WITHOUT solar
Battery storage without solar will rely on off-peak or shoulder grid electricity to charge the battery.
Energy retailers generally have three rate periods. Victoria’s average energy rates were used in the examples below:
- Peak:
- Time: Typically 3 pm to 9 pm on weekdays.
- Rate: The most expensive rate since demand is highest, often around 34 – 47 cents per kWh in Victoria.
- Why: This covers the evening period when people return home and use appliances, cook, and heat or cool their homes.
- Off-peak:
- Time: Usually 10 pm to 7 am on weekdays and often all day on weekends and public holidays.
- Rate: The cheapest rate, around 20 – 25 cents per kWh.
- Why: Demand is lowest overnight when most households are asleep and businesses are closed.
- Shoulder:
- Time: 7 am to 3 pm and 9 pm to 10 pm on weekdays.
- Rate: Mid-range pricing — cheaper than peak but more expensive than off-peak, often sitting around 25 – 35 cents per kWh.
- Why: These times reflect moderate demand as people wake up or wind down, but it’s not as high as the evening peak.
With this in mind, let’s look at a battery-only installation in Victoria.
Assumptions
- Battery capacity: 10 kWh (a common home battery size)
- Charge time: During the shoulder period (7 am–3 pm), at around 30 cents/kWh
- Discharge time: During peak hours (3 pm–9 pm), avoiding rates around 40 cents/kWh
- Efficiency: Let’s assume 90% round-trip efficiency — meaning you only get 9 kWh of usable energy from a full charge.
- Daily use: Fully charging and discharging the battery once per day.
Daily cost and savings
- Cost to charge (shoulder rates):
9 kWh × 0.30 (shoulder rate) = $2.70 - Cost avoided by not using grid electricity during peak hours:
9 kWh × 0.40 (peak rate) = $3.60 - Daily savings:
$3.60 − $2.70 = $0.90 per day
Annual savings
- 365 days:
$0.90 × 365 = $328.50 per year
Summary
A household with no solar but using a 10 kWh battery to charge during shoulder periods and discharge during peak hours could save around $330 AUD per year – assuming a full daily charge and discharge cycle.
The bottom line: Is it worth installing a battery-only system?
Relying on shoulder or off-peak rates on a general residential retail plan will definitely provide you with savings, but likely not enough to provide a return on investment. Power purchase agreements (PPAs), whereby electricity can be purchased at specific times for a set low rate, are generally reserved for commercial installations. However, it is worth exploring should you wish to install a battery for residential use.
The average cost of a battery is $1,000 to $1,300 per kWh of storage capacity. This would mean that a 10kW battery would set you back at least $10,000. With this in mind, a 10kW battery would not see a return on investment for 30 years! Batteries come with an average warranty of 10 years – so, to be frank, you would not see a payback on investment with a battery-only system.
Can I save by joining a VPP?
VPP events are one of the best ways to improve your return on investment period for battery storage. Some VPPs offer $1 per kWh sold to the provider during events. How much you can sell is often capped per event or per year. This might mean that you can expect additional returns from a VPP of around $200 per year. This would reduce the payback period for your battery-only system from 30 years to 20 years.
How to save on your electricity bills without solar
A solar system with or without a battery is one of the best ways to save money on your bills. Solar-only systems will usually see a return on investment within 3 to 5 years. Solar and battery systems can expect a payback period of 9 – 12 years. Homes with battery-only systems shouldn’t hold their breath for a return within the warranty period!
If you cannot install solar but still wish to save on your energy bills, you can do so by:
- Time-of-Use tariffs: Many energy plans have time-of-use pricing, which means they charge less during off-peak times (usually overnight or midday). Run appliances like washing machines, dishwashers, and electric vehicle chargers during off-peak hours. Set timers on air conditioning and heating to avoid peak periods.
- Energy-efficient appliances and habits: Upgrade appliances; Focus on energy-star-rated fridges, heaters, and washing machines – they use less electricity. Install smart plugs and power strips; these help you avoid “phantom load” — when electronics consume power in standby mode.
- Home efficiency improvements: Insulation and draft-proofing; prevent heat loss in winter and keep cool air in during summer. Window coverings; heavy curtains or blinds reduce the need for air conditioning. LED lighting; replace all incandescent bulbs with LED — they use 75% less energy.
- Review and switch energy plans: Energy providers constantly update their plans. Compare deals using platforms like Energy Matters Compare. Tip: Look for plans with high feed-in tariffs, off-peak rates, or bill credits for signing up.
- Green energy programs (Community Solar or Power Purchase Agreements): Some retailers offer green power programs, letting you buy a share in community solar farms or sign up for renewable power purchase agreements (PPAs). Programs like Solar Gardens allow you to benefit from solar savings without installing panels.
- Smart tech and monitoring: Smart meters help track real-time energy use so you can adjust habits instantly. Many retailers have apps that break down your energy consumption and suggest ways to save.
- Government rebates and assistance: Energy efficiency upgrades; check for local rebates on heating/cooling systems, insulation, and appliances. Bill assistance: many states offer concessions or hardship programs if you’re struggling to pay bills.
What should I do?
Where possible, Energy Matters recommends installing solar on your home. In situations where it is not possible, implementing energy-saving solutions will be your best bet at reducing your energy usage at no or minimal extra cost. Battery-only installations are certainly possible but not usually recommended if the aim is to save money. Keep in mind that commercial properties can benefit from battery-only installations. If you would like a commercial quote, please complete our quick form for FREE quotes.
Looking for further advice? Contact us today to see how we can help!
