Commercial Battery Storage UK: Costs, ROI & How It Works

A commercial battery stores electricity you’ve taken from the grid, on-site solar panels, or both so your business can use it later.

For the right site, a commercial battery can:

• Cut your electricity bills by buying less power from the grid when it costs more and using more of your own solar electricity
• Protect your site from additional capacity charges or the need to upgrade to a higher capacity
• Earn trading income from spare capacity (in Great Britain)

How much you save is influenced by factors like solar output, battery size, battery power, and your system control settings. In this guide, find out how commercial battery storage works, whether it can save your business money, and why your control system is more important than you think.

What is commercial battery storage?

A commercial battery storage system on your site stores electricity for later use.

A complete battery energy storage system (BESS) generally consists of these three parts:

Your site is connected to the grid/mains electricity system through a meter. This records how much electricity your site takes from the grid and how much it sends back.

Most commercial batteries are installed behind the meter. When the battery supplies electricity to your site, your meter records less electricity being taken from the grid (known as grid import). If the battery is supplying everything your site needs at that time, it may record no grid import at all.

Tip: You may also see commercial battery storage systems referred to as commercial energy storage systems, or simply commercial energy storage.

The benefits of battery storage for UK businesses

The eight main benefits of battery storage systems for UK businesses are:

Here’s more detail on each of the opportunities:

1. Buy electricity when it costs less

Your battery can charge up during a cheaper period and discharge to supply your site later, when it costs you more to buy electricity from the grid. This is called energy arbitrage.

2. Store more of your solar electricity

The solar panels on your site generate electricity. How much they produce changes throughout the day and depends on the weather.

When your panels are generating, your site can use that electricity to power its equipment. This reduces how much electricity you need to buy from the grid at that time.

Sometimes, though, your solar panels produce more electricity than your site needs. With battery storage for UK businesses with solar, your battery can store some of this spare electricity for later, such as when your panels are producing less or have stopped for the day.

Tip: You may hear this called commercial solar battery storage.

3. Reduce short periods of high electricity use

Your site will use more power when you’ve got equipment like machinery, compressors, refrigeration, or EV chargers running at the same time.

Many firms use commercial battery storage for peak shaving. Peak shaving means using your battery to supply some of the power your site needs during these busy periods.

You take less power from the grid during the peak, which can reduce your electricity bill.

4. Keep your site within its grid connection limit

Your grid connection limit is the maximum amount of power your site can take from the grid at any one time.

If you get close to that limit, your battery can step in to supply some of that power instead. This reduces the amount of power you take from the grid, helping you stay within your connection limit.

This can be useful if you want to add equipment such as EV chargers, heat pumps, refrigeration, or new machinery without having to pay to increase your grid capacity. However, if you need a lot of extra power, your battery may not be able to supply enough of it for long enough, so you’ll have to invest in a larger grid connection.

Note: Battery storage for commercial EV charging in the UK may help where adding chargers would otherwise push your site close to its grid connection limit.

5. Provide backup power

Your battery can keep stored electricity in reserve to use if there’s a power cut. For businesses like care homes, cold stores, and food manufacturers, this can keep vital equipment such as lighting, refrigeration, pumps, or control systems running.

Standard battery systems don’t automatically provide backup power, so you’ll need to ask your installer to design the system for it and decide which equipment it needs to support.

6. Earn income from wholesale electricity trading in Great Britain

You can sell electricity stored in your battery into the wholesale electricity market. When your battery sends electricity back to the grid, this is called grid export.

Charge your battery up when wholesale prices are lower and export that electricity when prices are higher. If the trade makes money, your business earns income from battery capacity you didn’t need to use on-site.

7. Earn income from flexibility trading in Great Britain

Another example of battery energy trading is flexibility trading.

You make money by changing how much electricity your site takes from or sends to the grid compared with its baseline. Your baseline is how much electricity your site was expected to take from or send to the grid if it didn’t take part.

Let’s say the grid needs businesses to take less power for half an hour. Your trading provider can tell your battery to discharge. Your site then takes less electricity from the grid than its baseline, and you can be paid for that change.

8. Earn income from other electricity system services in Great Britain

Some batteries can also earn money by helping keep Great Britain’s electricity system working properly.

These services are different from the flexibility trading example above. They can pay your battery for keeping power ready, reacting very quickly when the grid needs help, or being available when electricity supplies are tight.

Not every battery can take part in every service. Your trading provider can tell you which ones your battery and site may be able to use.

Tip: To make money from trading and electricity system services, you need to work with a specialist trading provider. More on that later in this article.

Could commercial battery storage save your business money?

Tick every box that applies:

☐ A power cut could stop work, damage stock, or leave important equipment without power☐ Your site sometimes needs much more power than usual when several pieces of equipment run at the same time ☐ Your solar panels sometimes produce more electricity than your site can use straight away ☐ You plan to add EV chargers, heat pumps, refrigeration, machinery, or other large electrical equipment ☐ Your electricity costs less at some times than others ☐ You are close to your grid connection limit and increasing it would be expensive or take a long time ☐ You often buy electricity from the grid after your solar panels have stopped producing power

The more boxes you tick, the more ways business battery storage may be able to save you money. However, one expensive problem can be enough. For example, avoiding or delaying a larger grid connection could make a battery worth investigating even if you have no solar panels.

This is only a quick check. Your installer will need to look at your actual electricity use, tariff, solar generation, grid connection, and what you want the battery to do before working out whether the project makes financial sense.

Which commercial battery setup is right for my site?

The right battery for your commercial site needs to be able to store enough electricity and supply enough power to do the jobs you want it to do.

You may want the same battery to do several jobs. For example, it could store spare solar electricity, reduce your power use during busy periods, provide backup power, or earn trading income.

But it cannot always do all of those jobs at the same time. If you keep some electricity in reserve for a power cut, for example, there is less available for other uses.

Before recommending a system, your installer therefore needs to understand what you want the battery to do and which jobs matter most.

They’ll take these factors into account:

1. When your site uses and exports electricity

Your annual electricity total tells your installer how much electricity your site used over the year. Your half-hourly data shows when you used it.

This information helps them see when your site uses the most and least electricity, and how this changes through the year. This pattern is called your load profile.

If you can, give your installer at least 12 months of half-hourly data. They should check it for missing readings, meter changes, shutdowns, or anything else that could make your normal electricity use look different from what it really is.

If your site exports electricity, give your installer your half-hourly export data so they can see when electricity leaves your site and how much.

2. Your electricity tariff

Your installer needs to know how much your business pays for electricity and how much it gets paid for sending electricity back to the grid.

They’ll need to know:

• How much you pay for each unit of electricity.
• Whether electricity costs more at some times than others.
• How much you are paid for each unit of electricity you send back to the grid.
• Whether you pay any extra charges for using the electricity network at certain times or using a lot of power at once.

If you pay different electricity prices at different times, your installer needs to use those different prices. Otherwise, they may work out your battery savings wrongly. A battery can save you more money when it supplies your site while grid electricity costs more.

Note: If you’re on a wholesale-linked tariff, exporting electricity from your battery may not always make you the most money. When wholesale prices are high, the electricity you buy from the grid may cost more too. In some cases, using the stored electricity to power your own site could save you more than exporting it would earn.

3. Your solar generation

For a commercial solar battery storage installation, your installer needs to know how much electricity your solar panels make, when they make it, and how much your site uses straight away.

Your grid meter cannot always tell them this. That’s because your solar panels may supply some of the power your site needs.

For example, let’s say your site might need 150 kW of power. Your solar panels supply 50 kW of that, so you only need to take 100 kW from the grid.

Because of the way grid meters work, they only record that 100 kW (your net grid import).

So, if your installer only looked at the grid data, they would think your site needed 100 kW when it really needed 150 kW. Your solar data shows them the missing 50 kW.

Your installer also needs to know when your solar panels generate more electricity than your site can use. They may recommend a battery that can store some of this spare electricity so your site can use it later instead of sending it to the grid.

4. How much power and stored electricity you need

Imagine your site needs the battery to supply 50 kW of power during a busy period.

If that busy period lasts for 30 minutes, the battery needs much less stored electricity than if it lasts for four hours.

Your installer therefore needs to know how much power you need and how long you need it for.

This is where kW and kWh come in:

If you want to store spare solar electricity, your installer also needs to check that the battery can charge quickly enough while that spare electricity is available.

Both figures need to be right. If the kW is too low, the battery cannot supply enough power at once. If the kWh is too low, it will run out too soon.

5. Your grid connection and future plans

Your installer needs to make sure the battery will work with the grid connection you already have.

If the battery charges from the grid, it must not push your site over its grid limit. If it sends electricity back, your installer also needs to know how much your site is allowed to send.

Make sure you also tell your installer about any plans that could make your site need more power in future. A battery that will handle the equipment and uses you have for your site now may not be right if you expand the site or add a lot more electrical equipment, for example.

One thing your installer will also do is check with the local electricity network whether it needs to approve the battery before it is connected or just needs to be told about it.

6. How much of the battery you need for backup

If you want backup power, tell your installer what needs to stay on if there’s a power cut.

They need to know:

• What equipment you want to keep running.
• How much power it needs.
• How long you need it to run.

Your installer can then work out how much electricity to keep in the battery for backup.

This affects how much of the battery you can use for its other jobs. For example, if you keep 30% for backup, you only have the other 70% to cut your bills or earn trading income.

7. Whether your battery can be used for trading

Not every battery setup can be used for every trading service.

Your installer and trading provider need to check whether your battery, inverter, meter, and control system can all work with the trading service you want to use.

If one cannot, they should tell you which part is the problem. You may need a different battery, inverter, meter setup, or control system, or you may need to use a different trading service.

How does commercial battery control software work?

Your battery and inverter limit how much electricity your system can store and how much power it can supply. Control software tells your battery when to charge, when to supply your site, and when to keep electricity stored for later.

Good commercial battery control software should put your site first. In other words, it should not use electricity for trading if your site is likely to need it for something more important, like keeping important equipment running during a power cut or supplying your site when electricity from the grid costs more.

There are two main types of battery control software. One follows a fixed schedule. The other can update the schedule when prices, solar output, or electricity use change.

1. Fixed control

Fixed control software sets the times when the battery charges and discharges. It follows these times until someone, like your installer or software provider, changes them.

For example, you might set the battery to charge from the grid overnight when electricity costs less. Later on, that charge supplies your site when electricity is more expensive. You could also tell it to keep some electricity stored for backup.

This can work well if your electricity use, solar generation, and electricity prices follow a similar pattern most days.

The problem comes when a day does not go to plan. Your busiest period may arrive later than usual, your solar panels may produce more or less electricity, or your site may use more power than expected.

The fixed schedule does not change by itself. So the battery could use some of its electricity too early or miss a better time to charge or discharge.

2. Flexible control

Flexible control software factors in electricity prices, how much your solar panels are expected to produce, how much power your site is using now or is expected to use later, and how much electricity is stored in your batteries.

It uses this data to decide whether the battery should charge, supply your site, or keep electricity stored for later.

As new information comes in, it can work this out again and tell the battery to do something different.

If your battery is used for trading, it can also follow instructions from your trading provider about when to charge or send electricity back to the grid.

For wholesale trading, this may mean charging when wholesale prices are lower and sending electricity back to the grid when prices are higher. For flexibility trading, it may mean changing how much electricity your site takes from or sends to the grid when the electricity system needs it.

How does a commercial battery trade with the electricity market?

A trading provider connects your battery to the electricity market and looks for times when it could make money.

It can tell the battery when to charge, when to supply your site, and when to send electricity back to the grid. Your control software follows those instructions while keeping your site’s needs first.

1. What does a battery trading provider do?

It may be able to make wholesale trades, flexibility trades, and other types of trade. The goal is to make you as much money as possible from your battery.

Sometimes that means keeping electricity in the battery so your site can use it later instead of buying expensive grid electricity. Other times, it means using spare battery capacity for a trade that earns more.

2. What is an energy aggregator?

An energy aggregator combines batteries with other energy equipment like EV chargers and heat pumps across lots of different sites.

Instead of acting alone, they act as a group. That lets companies with smaller batteries take part in electricity markets or services they may not be big enough to join on their own.

Some battery trading providers are also aggregators, but not all of them are.

3. What is a virtual power plant?

A virtual power plant, or VPP, is a group of batteries and other energy equipment at different sites that are connected by software.

The equipment stays at each site. The software lets the company running the VPP control the equipment together.

An energy aggregator may use a VPP to manage batteries and other equipment for lots of customers.

The difference is simple. An aggregator is a company while a VPP is the system it can use to group and control the equipment.

What does commercial battery storage cost in the UK?

There is no standard price for commercial battery storage in the UK but the published estimates online can give you a rough idea of what a project might cost.

Some UK guides suggest around £200 to £450 per kWh, while others use around £400 to £700 per kWh for commercial systems between 50 and 500 kWh.

Remember that you’re paying for more than just a battery, so don’t compare quotes on £/kWh alone. Look for the following on a quote you get from an installer:

Note: A larger battery can sometimes cost less per kWh than a smaller one. That’s because some project costs stay similar even when the battery gets bigger. This is another reason not to compare quotes on £/kWh alone.

How do you work out ROI for commercial battery storage in the UK?

To work out your return on investment on commercial battery storage in the UK, compare what your business would spend and earn without the battery with what it would spend and earn with it.

For a quick first check, use a blended electricity rate, or the average price you paid for each kWh of electricity across your whole bill.

For a full check in your ROI forecast, use at least 12 months of half-hourly electricity data and your real electricity tariff.

First, work out what your site would have paid without the battery. Check that figure against your real electricity bills. Then, use the same data to work out what your site could have paid with the battery.

Your forecast should include:

Use the same half-hourly model for all the ways the battery could save or earn money. This helps stop you counting the same saving twice.

For example, if your business stores solar electricity in the battery and uses it later instead of buying electricity from the grid, count that as one saving, not two.

If you keep some electricity in the battery for backup power, do not also count it as available for trading.

Sometimes the battery can cut two different charges on your electricity bill at the same time. An example of this is when the battery supplies your site at a busy time, so you buy less electricity from the grid and also pay less on a separate charge for how much power you use at once. If it does, count both savings but make sure you don’t count them twice.

What should you ask a commercial battery installer?

Your installer should be able to explain why they recommend a battery for your site and how much money they think it will save you.

If you are buying a new battery, ask them to show you the numbers before you agree to anything. If you already have a battery that is not saving as much as expected, ask them to help you find out why.

1. What should you ask before buying a commercial battery?

Before you agree to buy a battery, ask your installer to show you how they chose the system and worked out the savings.

Do not accept one savings or payback figure without seeing how they got it.

Ask them to show you:

• The information they used. This should include your half-hourly electricity data, tariff, and any solar or export data they used.
• Why they chose this battery. Ask why they chose this amount of storage in kWh and this amount of power in kW for your site.
• Where the money comes from. Ask them to show your electricity bill savings and any trading income separately.
• What the whole project will cost. Make sure the figure includes the equipment, installation, controls, software, and any costs you will keep paying after the battery is installed.
• What happens if things go differently. Ask for one forecast where things go worse than expected, one where they go as expected, and one where they go well.
• What happens without trading income. If trading is part of the forecast, ask what the battery would save if trading income was very low or there was none at all.
• How long it could take to pay for itself. Ask to see the expected payback time and percentage return.
• Who will check the savings afterwards. Ask who will compare what you were promised with what the battery actually saves once it is running.

If your installer cannot show you where the figures came from or explain them in words you understand, ask them to do that before you agree to the project.

2. What should you ask if your commercial battery is saving less than expected?

Your battery setup can be working properly and still save less money than you expected.

Instead of assuming you need a new battery, ask your installer or software provider to check why the savings are lower than expected.

These are some warning signs to look for:

Ask for the battery data from the time you want to check. It should show when the battery charged and discharged and how full it was.

Then look at what was happening at your site at the same times. Check how much electricity your site was using, how much your solar panels were making, and what you were paying for electricity.

If you still cannot work out why the savings are low, ask an independent battery expert or another installer to check the system. Give them the original forecast, recent battery data, electricity bills, tariff, and solar data. They may find ways the battery could be saving you more money.

If the battery itself is working properly, you may not need to replace it. Changing when it charges and discharges could improve the savings instead.

Could your current or planned commercial battery save more with GridVolt?

GridVolt works with compatible batteries and inverters from other manufacturers. If you already have a battery, we can check whether better control could help it save you more money. If you are planning a new battery, we can help you check the expected savings before you buy.

At one agricultural site, GridVolt’s Energy Manager increased battery savings by 41% in its first 70 days. Most of the extra savings came from using the battery at better times to reduce DUoS and Capacity Market obligation charges. That was a 41% increase in the savings made by the battery, not a 41% cut in the site’s whole electricity bill.

Tell us about your site, tariff, solar panels and battery. If your site is in Great Britain, we can also check whether spare battery capacity could earn trading income through GridTrade.

Commercial battery storage: frequently asked questions

Can a business use battery storage without solar panels?

Yes. Your business can charge a battery from the grid when electricity costs less. The battery can then supply your site later when electricity costs more or when your site needs a lot of power.

What is the difference between commercial and industrial battery storage?

People in the energy industry do not use one fixed rule to separate commercial battery storage from industrial battery storage.

Businesses often use industrial battery storage systems at larger sites that need a lot of power, such as factories, cold stores, processing plants, and large warehouses. Companies also use battery storage for commercial buildings such as offices, hotels, care homes, shops, and business estates. People may use the term industrial solar battery storage when an industrial site also has solar panels.

How long does a commercial battery last?

You can expect different lifespans from different commercial batteries.

The type of battery and its temperature both matter. Your business may also shorten its life if you use it very often, take out most of its stored electricity each time, or charge it very quickly.

As the battery gets older, your business will gradually have less stored electricity available to use.

When you compare batteries, check the warranty as well as the amount of electricity each one can store when new.

The battery maker should tell you how long the warranty lasts and how much storage capacity you should still have later. Also check whether the maker limits the number of times you can charge and discharge the battery or the total amount of electricity you can put through it.

Does commercial battery storage need planning permission?

Sometimes. The Health and Safety Executive says your local planning authority decides whether you need planning permission for a battery energy storage system.

Ask your installer to check the local rules before they finish the design.

Your local authority and fire service may ask for more work if you plan to put a large battery outdoors or inside a container than if you install a smaller battery inside a building.

Does a commercial battery need a G99 application?

The Energy Networks Association says installers must follow G98 or G99 rules when they connect battery storage to the local electricity network.

Your installer should work out which rules apply from the size and design of your system. They should then check this with the company that runs your local electricity network. People in the industry call this company the Distribution Network Operator, or DNO.

Can a commercial battery earn money from the grid?

Yes, if your site is in Great Britain and you meet the rules for the trading service you want to use.

Ask a specialist battery trading provider to check whether you can take part. They should check your battery, inverter, meter, grid connection, spare battery space, site limits, fees, and how you will share the trading income.

Get them to do this before including trading income in your payback figures.

How does P415 affect commercial batteries?

Under P415, some businesses in Great Britain can use a separate trading provider without changing their electricity supplier. Your trading provider can arrange changes to how much electricity your business takes from or sends to the grid. If you have the right setup, your provider may also use spare space in your battery for wholesale electricity trading.

Ask the provider to check whether your site can take part and how much you might earn. Different businesses will earn different amounts.

Can a commercial battery benefit from negative electricity prices?

Sometimes. Your business does not automatically get paid when wholesale electricity prices fall below zero.

If you have an electricity tariff that follows wholesale prices, your business may be able to buy electricity and store it when prices fall very low or below zero.

A trading provider may also use spare space in your battery at these times. Ask your supplier or trading provider to work out what you could save or earn. They will need to look at your tariff, spare battery space, battery power, electricity use, and any fees.

Read our guide to negative electricity prices for more detail.

What is different about commercial battery storage in Ireland?

Businesses in Great Britain and Ireland follow different electricity market and grid rules. GridVolt only offers GridTrade in Great Britain. If your business is in Ireland, you can still use Energy Manager with compatible batteries and other energy equipment to help cut your site’s energy costs.

Read our separate commercial battery storage in Ireland guide for the Irish market.

Can a commercial battery be installed at any business site?

Not always. Ask your installer to check whether you have enough space for the battery and inverter and whether they can connect the equipment safely to your electrical system.

Your installer should also check whether you need extra electrical work, building work, or other changes before they start. They should follow the battery maker’s installation rules too.