Home battery storage is a rapidly evolving technology, often used in conjunction with solar photovoltaics. It allows excess electricity generated by solar panels to be stored for later use instead of being exported to the national grid.

If you have solar PV, you can generate a lot of electricity when the sun is shining. But on cloudy days, you earn less, and at night you earn nothing at all. This mode of power generation often doesn't match the time when the household wants to use electricity - at night when you want to turn on the lights and use appliances like the dishwasher or TV.

If your solar panels generate electricity and you don't use it, it ends up being fed into the national grid. You might get paid for it, but not as much as you save if you use the power yourself.

That's where battery storage comes in. If you can store the electricity you generate during the day, there will be less need to consume electricity - running a washing machine, for example - and you will use more electricity when the sun is shining, and save money. 

In addition, some batteries can now export and import electricity directly to the grid, helping to balance the country's supply and demand issues and reduce peak carbon emissions. New ways of participating in energy trading are emerging, such as selling electricity to local neighbors or microgrids, or being part of an international "battery community."

If you're a low-battery user and want a quick return on your investment, battery storage may not be for you. However, you may need to dig deeper if:

You want to maximize your self-generation, but you can't adjust your household behavior to make it happen. (i.e. you can't use most of the electricity during the day, or generate much more electricity than you use).

You want to play an active role in the energy system of the future and reduce carbon emissions. 

You want to be off the grid or be as energy self-sufficient as possible.

To evaluate a financial investment, you need to know your annual household electricity consumption, as well as the actual or expected annual electricity production from your solar panels. Next, you need to consider possible installation costs based on the type of battery you want and any potential export payments.

The first is the battery itself. Once you understand your power usage and generation, you can consider the type of battery storage system that is right for you. The following points are designed to help you do just that.

It's worth keeping in mind that battery storage is evolving rapidly. By 2022, storage capacity (domestic and non-domestic) in the UK is expected to be 50 times what it was two years ago, and this growth is likely to drive down costs. In addition, the technology itself, and related services, are also changing, becoming more complex and providing more options for those seeking to participate more actively in an increasingly decentralized electricity network.

Most home energy storage batteries are lithium-ion batteries (also used in consumer electronics). These batteries are lighter, smaller, and longer-lasting than lead-acid batteries. They have a high energy density (kWh/kg), so more electricity can be stored and more can be released at any time. They are also more efficient than lead-acid batteries in terms of energy loss and require less maintenance to keep the battery healthy. Therefore, lithium-ion energy storage systems are more widely used.

Capacity is how much electricity a battery can store, measured in kilowatt-hours (kWh). The usable capacity is less than the total capacity because the batteries should not be fully discharged as it would damage them (a "charge controller" prevents this). A 14kWh battery might have a usable capacity of 13.5kWh.

A cycle is a full charge and a full discharge, but that rarely happens. Batteries are usually partially charged, so a 50% charge and discharge is half a cycle. If you know the number of warranty cycles (i.e. the number of cycles you are guaranteed to get), you can calculate how many kWh the battery will give you, e.g. 10,000 cycles of a 12kWh battery will provide about 120,000kWh. Over time, the battery will degrade and you will receive fewer kWh per cycle. Current batteries have a 6,000-10,000 cycle warranty. This is different from the usual 10-year product warranty, although the battery lasts longer than that.

This is the power input and output in kW. Make sure your battery has enough power output to run the appliances you use; a 5kW output can run a kettle, tumble dryer, or electric fire, but a 2kW output may not. If you can't get enough stored battery power when you need it ("bottleneck effect"), you need to supplement your supply with grid power. Likewise, if you can generate 4kW and your battery can only put in 2.5kW, you're wasting 1.5kW of electricity that you can't store (but can export to the grid). 

There are a wide variety of batteries on the market and prices vary. If you're trying to decide between similar batteries, the price/kWh of storage capacity is a useful way to compare different systems.

Some batteries do not provide backup power in the event of a power outage. Is this important to you? If so, rewiring may be required, and you'll need more storage capacity to accommodate that reserve.

Solar PV requires inverters, as do batteries. Systems using DC coupling have a single combined inverter, while AC coupling requires separate inverters for the battery and panel. The type of coupling used has an impact on the functionality and efficiency of the system.

An electric car is a large battery on wheels that can be set to recharge automatically when excess power is produced if left at home during the day. Because of cost alone, it's unlikely that most households will have both an electric vehicle and a battery storage system. If you plan to have both, discuss with the installer how they will interact - especially in terms of battery capacity and discharge rate.

Some batteries can be used to store not only electricity from a home's solar panels but also surplus electricity from the grid. This "smart" battery draws power from the grid when it is plentiful and cheap, and can be used at home later, or sold back to the grid at a higher price when national demand is high. This "virtual power plant" (VPP) service that helps balance the national grid is rapidly developing, but be aware that not all batteries can do this, and there are unresolved issues surrounding the finer details of their operation, For example, whether this "-exported electricity will be eligible for a smart export guarantee payment (see box). VPP services require an agreement with energy companies or third parties, some energy companies may need to install separate meters. 

VPP services are one of several ways that battery storage can change the relationship between home generation and the grid. Others include microgrids (local independent grids), peer-to-peer transactions (such as selling electricity to neighbors), and public energy supply (battery owners sharing electricity with each other). Systems such as these utilize smart meters and may include time-of-use pricing, where the cost of electricity is based on the level of national demand.

An average battery will cost £4,000-8,000 to install, with a usable capacity of 3.8-13.5kWh and a charge/discharge of 2.0/5.5kW. Remember to factor VAT into your costs. Currently, installing batteries with a solar PV system is subject to a 5% VAT, while retrofitted batteries are subject to a 20% VAT. 

Calculating your return on investment is not straightforward, but the calculation below will give you a very rough idea. For simplicity, it assumes you are not generating electricity yet (if so, you can use your annual bill before installing the solar panels). The calculation also assumes that your battery can store all the power you generate and discharge it at a rate that meets your needs.

1. Start by comparing the annual kWh usage you pay to the power company with your expected annual power generation. 

2. If your electricity generation exceeds your usage: divide the battery cost by your annual electricity bill. This gives you the number of years it will take to pay for itself, but keep in mind that batteries will degrade over time. 

3. If your usage exceeds your usage: first calculate your usage as a percentage of your annual usage (assuming you generate 60% of your usage). Next, calculate 60% of your annual electricity bill (£300 on a £500 bill). Finally divide the battery cost by £300 to get the payback time. 

4. Once SEG payments become an option, you can also factor their payments into your return on investment. 

If cost is your main consideration and batteries are currently too expensive, wait a few years for prices to drop. But if you're looking beyond financial rewards, such as wanting to be more self-sufficient or to be an active part of a decarbonized energy system - or because you just love the technology - battery storage may be for you. If you want to buy a lithium battery energy storage system, please contact us.

RENON Power is a professional custom lithium battery energy storage systems manufacturer. With independent research and development capabilities and a focus on ESS solutions, RENON is a leading supplier of BMS, ESS, modules, and monitoring systems. Our business scope integrates R&D, design, production, and sales. Based in the United States, it has several sales offices, product centers, joint venture factories, and wholly-owned subsidiaries around the world. RENON is committed to providing you with safe, lightweight, and long-lasting green energy products.