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. We’ll look at the best (and the most cost-effective) batteries for your solar panels, answer your frequently asked questions, and explore how solar batteries work alongside the Smart Export Guarantee (SEG) – the scheme which allows you to sell any excess electricity your solar panels generate back to the grid for a profit.

Solar batteries can store any excess power generated by your solar panels to be used when the sun isn’t shining. (Image credit: Adobe)

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 £3,000 – 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
• A solar battery with a 4kWh capacity will cost less than a 6kWh alternative

Discover how much a solar battery would cost for your system by answering a few quick questions

Lithium-ion solar batteries are more expensive initially, but they work out cheaper in the long run because they last longer. (Image credit: Adobe)

Best type of solar battery

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.

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 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;
• 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%
• Lead-acid’s DoD is only 50%

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.

How much ROI can you expect to see on your solar battery? Let’s break down the numbers based on the lifespan of your average domestic solar array – 25 years.

First up, the cost of the batteries themselves. You’ll need to replace your solar battery around halfway through your solar panels’ lifespan, meaning you’ll have purchased two sets of batteries at a cost – depending on the type of solar batteries you select – of between £5,000 and £12,000 altogether.

Secondly, how much will solar batteries actually save you? Based on the average three-bedroom household, you can expect to see annual savings of around £186 on your energy bills.

Over 25 years – the average lifespan of your solar panels – that’s £4,650 of savings. Unfortunately, this isn’t quite enough to cover even the cheapest of solar batteries – and, over a 25-year period, you could be looking at losses of between £350 and over £7,000.

It’s not all doom and gloom, though – because households in England, Wales, and Scotland can still  benefit from a Smart Export Guarantee (SEG) tariff. The SEG allows you to sell the renewable energy you solar panels generate back to the grid – for a profit. Under the SEG – which replaces the Feed-in Tariff, a similar scheme now closed to new applicants – all licensed energy providers with over 150,000 domestic customers must provide at least one SEG tariff. 

However, the SEG doesn’t specify how much suppliers have to pay for your excess energy – it just has to be more than zero. What this means is that the rates you may receive for selling the electricity stored in your solar battery back to the grid will fluctuate massively – so it’s crucial to select the right SEG provider (called SEG ‘licensees’) to avoid these suppliers selling your short on your solar, and maximise the ROI or your solar battery.

There are 13 different companies – which you can find on Ofgem’s list of licensed SEG suppliers – that offer SEG rates. You don’t also have to be receiving electricity from these companies to export to them – purchasing and selling electricity count as two separate services, and you can choose two separate companies to fulfil those needs. However, it does help if you use the same company for both, as you can usually receive a better SEG rate.

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% of the power your solar panels generate.

Are solar batteries worth it? Yes, if you can afford them. While we expect them to get cheaper as the technology becomes more widely available, right now solar batteries are expensive.

So, while they will help reduce your energy bills by enabling you to store the solar energy you produce – not only to power your home, but to sell to the National Grid as a bonus – these savings won’t ever offset the entirety of that hefty upfront investment.

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

Ultimately, though, solar batteries are less a savvy financial decision, and more a savvy environmental decision. 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.