Are solar batteries worth it?

Solar panels are an increasingly popular solution for UK homes – largely because of how much money they can save you on your energy bills.

But if your household is one of the estimated 1.5 million in the UK with solar panels, you’ll now be pondering a different question: are solar batteries worth it?

Below, we’ll explore the average cost, lifespan, and expected return on investment of a solar battery in the UK in 2024.

Solar batteries store the excess energy your solar panels generate, instead of letting it go back to the National Grid.

You can then draw on this stored energy to power your home during times of the day – or year – when your solar panels aren’t generating as much electricity, such as on cloudy days or at night. You can also sell it back to the grid to save you even more on your energy bills – more on that later. 

What are the advantages of installing a solar battery?

• Energy independence: solar batteries let you store excess solar energy generated during the day for use at night, or on days when there’s not much sun. This reduces your UK home’s reliance on the grid and enhances energy independence.
• Reduced electricity bills: by storing excess solar energy and using it during peak times, you can save on your electricity bill costs.
• Financial incentives: through the UK’s Smart Export Guarantee (SEG) scheme, you can sell the excess electricity stored in your solar battery back to the grid.
• Backup power: solar batteries provide backup power during grid outages, ensuring that your key appliances and systems remain live – even in a power cut.
• Environmental benefits: solar batteries help reduce your home’s reliance on fossil fuels by enabling the use of clean, renewable solar energy; this reduces carbon emissions and helps mitigate climate change.

Why are solar batteries not always installed in houses with solar panels? 

• High initial cost: the upfront cost of purchasing and installing a solar battery system is a big one, on top of the price of solar panels themselves.
• Limited energy storage capacity: most residential solar batteries have limited storage capacity; this may not be sufficient to meet your household’s entire energy needs, especially during extended periods of low sunlight.
• Efficiency losses: solar battery systems incur some energy losses during the charging and discharging process, which reduces overall efficiency compared to direct use of solar energy.
• Maintenance requirements: like any other electrical system, solar batteries require regular maintenance to ensure optimal performance and longevity. This may include monitoring battery health, software updates, and occasional repairs.
• Space requirements: solar batteries require space for installation, which may be limited in some households – especially urban or densely populated neighbourhoods.

In the UK, solar batteries cost anywhere between £2,000 and £12,5,000 – it  depends on the battery’s capacity, chemical composite, and life cycle, as well as the supplier you choose.

For example:

• A lithium-ion (Li-on) solar battery will be more expensive than a lead-acid solar battery;
• A solar battery that dies after 1,800 charging cycles will be more affordable than one that lasts up to 4,000 cycles; and
• A solar battery with a 4kWh capacity will cost less than a 6kWh alternative

There are two types of chemical materials commonly used for solar batteries – lithium-ion and lead-acid. But which one is most cost effective, which lasts longer – and which one is better-suited to the needs of your UK home?

According to all evidence, lithium-ion solar batteries come out on top.

Cost effectiveness

Although the initial cost of lithium-ion batteries is double the cost of their lead-acid counterparts (around £4,000 versus £2,000 for a 4kWh battery), Li-on batteries have a higher cycle lifespan, are more efficient, and perform better in hotter environments.

This makes them  more cost-effective than their lead-acid counterparts: with recent data demonstrating a lead-acid battery would need to be around two and a half times larger in capacity than a Li-on one to achieve a similar cycle life.

Cycle life of solar batteries

So, why is cycle life (or, if you prefer, life cycle) such an important consideration when choosing the most cost-effective solar battery for your home?

Put simply, it’s because the more life cycles your solar battery has, the longer time it can perform at an efficient rate for. A longer lifespan also means you’ll incur fewer replacement costs going forward.

When comparing the two batteries with a 4kWh storage capacity, the differences are particularly noticeable:

• Lithium-ion batteries typically have a life cycle (complete charge/discharge cycles) of 4,000; and
• Lead-acid batteries have a 1,800-cycle lifespan

Storage capacity

So what about storage capacity? This reflects how much energy your solar battery can store. Storage capacity is important because the larger the capacity, the more energy the battery can store – and the more your home has to draw on when solar production is down. Another key metric, meanwhile – Depth of Discharge (DoD), or usable capacity – refers to the percentage of your solar battery’s storage space you’ll actually be able to use. 

For example:

• Li-ion’s DoD comes in at 90 per cent; and
• Lead-acid’s DoD is only 50 per cent

Unlike solar panels – which typically last for around  20 to 30-years – solar batteries have a lifespan of between five and 15 years.

Are solar batteries worth it, then, knowing you’ll have to replace them in the future – perhaps even as soon as five years’ time? Let’s take a look at the average solar battery’s return on investment (ROI) to find out.

So, much ROI can you expect to see on your solar battery? Let’s say you own a three-bed home in the East Midlands. Our calculations suggest it’d cost you £7,100 for your solar panels and installation, producing energy savings of £252 a year. That means it’d take you 28 years to start seeing a return on your investment. 

With a solar battery for an additional cost of £2,500, that saving increases to £796 a year – meaning you’d pay off your solar panels and battery costs in just over 12 years. More than twice as fast as without a battery despite the initial increase in upfront costs.

You’ll likely need to replace your solar battery at least once if you want it to match the 25-year average lifespan of a solar panel set-up. Even then, however, it would take a bit more than 15 years to recuperate your initial costs – still much faster than without a solar battery.

And your potential ROI doesn’t end there. Households in England, Wales, and Scotland can also benefit from a SEG tariff. The SEG allows you to sell the renewable energy you solar panels generate back to the grid – for a profit. 

 The rates you may receive for selling the electricity stored in your solar battery back to the grid will fluctuate massively. Therefore it’s crucial to select the right SEG provider (called SEG ‘licensees’) to avoid these suppliers selling your short on your solar. You’ll have a choice from 13 different companies – which you can find on Ofgem’s list of licensed SEG suppliers.

If there’s no more storage space because your solar battery is full, the renewable energy your solar panels generate will simply stop being absorbed. Your solar panels will continue to generate energy, but it won’t be used or stored until there’s demand or space for it. Similarly, if you don’t have a solar battery you’ll need to use up, or sell to the grid, every kilowatt of electricity your panels generate – otherwise, it’ll go to waste. You’ll lose about 50 per cent of the power your solar panels generate.

Are solar batteries worth it? Yes, if you can afford them. Although it may take a while to start seeing a return on your investment, our calculations show that you’ll pay back your initial solar set-up costs much faster with a battery than without. 

 There are also scenarios – if you want to live off-grid, for example – where solar batteries aren’t a nice-to-have, but a must-have.

Of course, you can’t ignore the environmental element. By storing more of the energy you generate through your home’s solar panels, you’re reducing your household’s reliance on fossil fuel-based forms of energy – and, in the process, contributing to a cleaner, greener future.