The past two years have seen record growth in home solar installations in the US. Based on industry data, residential solar installations even grew 30% from Q1 to Q2 in 2023, despite economic uncertainty. In addition, the Solar Energy Industries Association predicts that the wide scale adoption of solar will ultimately lead to the wide scale adoption of storage.
Why is this? It’s a complex question that involves energy security and independence, policies like California’s NEM 3.0, time-of-use (TOU) rates, and the increasing affordability of batteries themselves. Let’s get into these reasons and more to help you decide whether battery storage is right for you.
Why homeowners are turning to battery storage
In 2010, most lithium-ion batteries were relegated to devices such as laptops and mobile phones. By the end of the decade, however, lithium-ion batteries could be found powering houses and vehicles.
There are several reasons why solar power users are increasingly turning to battery storage:
- It allows users to store excess solar energy for when they need it.
- It enables homeowners to be less dependent on the grid.
- In some areas, policies like time-of-use rates make battery self-consumption an interesting option.
- The surge in lithium-ion production has driven prices down to be an attractive option for regular consumers.
- A PV system combined with battery storage allows users to have an alternative power source that’s environmentally friendly.
- Steady improvements in battery technology have led to improved capacity, efficiency, and longevity, and made batteries more economical for both small- and large-scale use.
One of the most exciting opportunities that battery storage provides is more options for managing surplus electricity that the system generates but the home doesn’t use. PV systems with no battery storage rely on net metering (NEM) to offload surplus electricity back to the grid.
But, often, these NEM policies offer low payback rates during the day (when the sun is shining). Likewise, time-of-use (TOU) rates often assign a higher price for electricity during the evening — when grid use is heavy and the sun is down.
With batteries for their home, solar customers can store excess energy for use later in the day, when the sun isn’t shining and TOU electricity rates potentially go up.
California’s Net Billing Tariff (NEM 3.0), for example, initiates higher electricity rates during peak usage times. Battery storage allows homeowners to avoid higher rates during peak times. In fact, homeowners can even send battery power back to the grid at times when rates are highest. To learn more, check out Aurora’s dedicated NEM 3.0 resource center to help you navigate the transition, including powerful tools for selling battery storage.
What to look for when choosing a solar battery
Solar batteries have contributed significantly to the growing use of solar energy. They store surplus power generated during the day for use when the sun goes down, or when it disappears behind the clouds. Also, with a battery you can use less electricity from the grid, resulting in a lower utility bill.
In fact, you may not even need a large battery to see the benefits of energy storage. Even a small battery can noticeably lower your grid usage when time of use (TOU) rates are highest.
But not just any solar battery can do the job you need. Before you talk to a solar installer about PV systems and the accompanying solar batteries, you need to learn how to choose the best solar battery for you. Here are some important things to consider:
The capacity of a battery is the amount of energy, measured in kilowatt-hours (kWh), a particular battery can store. In other words, capacity will determine how much electricity your battery can store, and how long the charge can last. Before selecting your solar battery, start by establishing your daily energy consumption.
To determine your daily energy requirements. Consider the following:
- Appliances you use regularly in your home
- How much electricity you use each day
- The readings on your average utility bills
- How much backup capacity you’re comfortable with
Once you have established your daily energy consumption and how much backup works for you, you can go on to decide on what pV system size works best, and how solar + storage fits with your budget.
Before choosing your preferred solar battery, look at its power in terms of its peak and continuous delivery performance. Power is an important factor, and goes hand-in-hand with capacity when deciding on the right system for you.
A high-capacity, low-powered battery can supply power for a few essential appliances, such as the fridge, or washing machine, for a longer time. A low-capacity but high-powered battery may power your entire home, but for a limited period of time. Talk with your solar installer about a balance between capacity and power rating — they can help you choose the right solar battery for your needs.
Depth of discharge (DoD)
The chemical nature of solar batteries requires some charge to keep them working efficiently and longer. Depth of discharge (DoD) refers to the amount of charge you can use from your battery before you affect its optimal performance. A higher DoD means you can use more of your solar battery capacity before you need to recharge it.
For example, a 10 kWh solar battery with 80% DoD means you should never use more than 8 kWh of its stored power. Exceeding this limit may shorten its lifespan significantly.
Round-trip efficiency represents the amount of energy put in the battery that can be retrieved for practical use. The higher the round-trip efficiency, the more efficient and economical the battery is.
To better understand the concept of the round-trip efficiency, consider this example: If your battery can hold up to 10kWh of power, but you can only use 8kWh of it, your battery has a round-trip efficiency of 80%. If you’re shopping for the best solar battery, get one with the highest round-trip efficiency.
Manufacturers offer a wide range of warranties, depending on the brand as well as the type of battery. Lead-acid batteries usually have a shorter warranty period compared to more expensive lithium-ion, which can be covered for up to 10 years or more.
The battery’s ability to store charge diminishes with use, and eventually it doesn’t hold as much charge as it did when it was new. After years of use, depending on its quality, the battery may stop holding charge completely. In general, batteries with a longer break-in period before reaching their peak capacity performance tend to have a longer lifespan, compared to those with a high initial capacity.
The price of a solar battery is, of course, one of the most important factors to consider before making the purchase. You will have to strike a balance between affordability and quality when deciding which solar battery to buy. The cost of solar batteries ranges from $3,000 to well over $20,000.
Here is a quick summary of the average costs of the different types of solar batteries on the market:
- Lithium-ion: $7,000-$30,000 average cost, some extra maintenance can be required.
- Lead-acid: $5,000-$15,000 average cost, generally low maintenance.
- Lithium-iron-phosphate: $9,000-$30,000 average cost, generally long lasting and low maintenance.
Types of solar batteries for the home
It is also vital to know the types of solar batteries available. Here are the two most common types, and their pros and cons:
These batteries are the oldest on the market and generally the cheapest. They can be the best bet if you need lots of energy, but wish to go off-grid. They come in two types: flooded, which requires regular maintenance, and sealed, a maintenance-free option.
- The most affordable solar battery type available
- Quite reliable
- Suitable for off-grid power needs
- Lower DoD of about 50%
- Shorter lifespan compared to other battery types
- Much larger and occupy more space per kWh
Lithium-ion batteries are newer battery technology than lead-acid, and preferred by most homeowners today.
- More compact than lead-acid
- Need no regular maintenance
- Have a longer lifespan because of a higher DoD of about 90%
- More expensive than their lead-acid counterparts
- Can be prone to thermal runaway
With circumstances ranging from extreme weather and grid reliability, to time-of-use rates and other policies solar batteries are becoming more popular. There are many types to choose from, but hopefully, you’ve got a better idea of what you’re looking for now. If you’re interested in learning more about solar energy storage, check out our solar storage resource page.