How does battery storage save money?

Battery storage saves money in two main ways: tariff arbitrage (charging on cheap off-peak electricity and discharging during expensive peak hours) and solar self-consumption (storing excess solar generation for use in the evening instead of exporting at low SEG rates). Time-of-use tariffs like Octopus Agile maximise savings.

What is depth of discharge?

Depth of discharge (DoD) is the percentage of total battery capacity that is actually used. Most lithium-ion batteries have a DoD of 90-95%, meaning a 10 kWh battery provides 9-9.5 kWh of usable capacity. Running to 100% DoD reduces battery lifespan.

How long do home batteries last?

Most home batteries come with a 10-year warranty and are expected to last 12-15 years. Capacity typically degrades by 1.5-3% per year, so after 10 years the battery may have 70-85% of its original capacity. Lithium iron phosphate (LFP) batteries degrade more slowly than NMC chemistry.

What is a typical payback period for battery storage?

With a time-of-use tariff and solar PV, payback is typically 6-10 years in the UK. Without solar or TOU tariff, payback can be 12-15+ years. The economics improve with larger tariff differentials, more daily cycles, and falling battery costs.

Can I do more than one cycle per day?

Yes. With time-of-use tariffs you might charge overnight and discharge in the morning peak, then charge from solar midday and discharge in the evening peak — achieving 1.5-2 cycles per day. Some tariffs like Agile allow 2+ cycles. More cycles improve ROI but increase battery degradation slightly.

TradeCalculator

Battery Storage ROI Calculator

Calculate the return on investment for home battery storage based on tariff arbitrage, solar self-consumption, and degradation over time.

Battery Capacity

Total nominal capacity

Installation Cost

Fully installed cost inc VAT

Peak Electricity Rate

Daytime / peak tariff rate

Off-Peak Rate

Night / off-peak tariff rate

Daily Cycles

How many full charge/discharge per day

How We Calculate This

This calculator estimates the financial return from home battery storage based on the usable capacity, daily cycling pattern, and the difference between peak and off-peak electricity rates.

ROI formula

Daily saving: Usable kWh x daily cycles x (peak rate - off-peak rate)
Solar bonus: Additional saving from self-consumption vs export
Annual saving: Daily saving x 365
Degradation: Capacity reduces by 1.5-3% per year, reducing annual savings over time
Payback: Years until cumulative savings exceed installation cost

Frequently Asked Questions

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Last updated: March 2026

All calculations are estimates. Verify with your supplier.