Paying to export solar and can a battery save money

A newsletter reader asked me to analyse their energy consumption and solar exports to see if a battery could help them save more money. Here is a look into that report.

To figure out if a battery can save a home significant money I modelled and simulated the charge and discharge cycles of five different batteries from 6.4 kWh up to 15 kWh over the course of a year to see how much money they could save.

I also modelled a few scenarios where they pay to export solar, which is a real possibility in their area under the negative feed-in-tariff Ausgrid proposal. Overall though things are looking positive!

A battery would save this home around $740 to $990 a year on their energy bills

As this home already had an existing 6.5 kW solar system, the homeowner wanted to know roughly what kind of savings a battery could unlock. They also wanted to know what battery size would be most optimal given their consumption patterns and solar production throughout the year.

Also, given this home is in the AusGrid distribution region he was wary that there will be upcoming changes to solar credits this year, according to the Ausgrid proposal solar export export credits will start to go negative from July onwards.

In the table below, we used their current energy pricing and their solar credit price of 3.3¢ to calculate how much they could save and earn in solar credits with each battery for a full year.

Note that from 12.8 kWh upwards the battery begins to reach a point of diminishing returns, the jump in savings at these larger battery capacities isn't as significant, making a larger capacity unnecessary.

A 9.6 kWh battery would decrease the solar export costs by 58%

With the proposed Ausgrid solar export costs the homeowner wanted to know if those costs are avoidable and to what degree.

The findings are that the overall savings as a percentage are quite high, the 6.4 kW battery would help the home avoid 41% of the proposed costs given their solar export patterns throughout the year. But overall we are only talking about a few dollars, mostly because the proposed solar export penalties are so low.

In the chart below the first row is the amount of money the home would earn given the new export proposal, separately the second row is the amount of money it would cost the home. The total cost would be the credit row minus the penalties row for each battery size. In short, every battery would still incur solar export costs, but it's not a huge amount.

If the home installs a 10 kWh battery, it would only save around $22 a year in avoided export penalties. Even with a battery there will still be summer days where the solar produces more energy than even the larger batteries can store. The exports costs are basically unavoidable if a battery is the only strategy to try and avoid them.

While the export tariff change isn’t a massive cost right now, it could increase over time. If penalties were to go up in the future, having a battery could help mitigate those rising costs. But as things stand today, the main benefit of a battery isn’t avoiding the export fee, it’s reducing the costs of the energy bill overall.

The utilisation rate is higher for a bigger battery, but is it worth it?

I occasionally get emails and messages from a few battery fanatics telling me I need to focus more on the utilisation rate of the battery because a more utilised battery equals savings. While mostly true I'd say it depends also on when the battery is utilised.

Also we have to take into account the purchase cost, if the 10 kWh battery saves the home $900 and the 15 kWh battery will save $990, we need to ask if that 10% of extra savings is to be worth it.

While I don't go into costs and quotes because it can be so variable from one company to the next, with the above info, a home could easily weigh up the value of a bigger battery and if its worth the extra cost.

Do you have solar and want a battery analysis for your home?

On the SolvingZero site we can access your solar exports and energy consumption via your energy provider. It takes about two minutes to do online, we don't need to connect a device or visit your home.

Once connected, we can then model in different battery sizes to see what kind of battery would be most optimal for your home. We also calculate the rough savings of each battery for a year given your home's real consumption patterns. We don't have to visit your home or connect a device, this whole analysis is done remotely. If you'd like to have your own battery report and analysis, reply to this email and let me know, and I'm happy to chat about it.