Adding a battery to a commercial solar installation can offer greater savings but, in some cases, means a longer project payback. The difficulty for finance directors and CFOs is knowing whether the battery earns enough extra to justify what it adds to the project cost.
In this article, we explain how commercial solar battery storage works, when adding a battery makes commercial sense, what it could cost and how to work out whether the battery will pay for itself.
What is commercial solar battery storage?
Commercial solar battery storage is a battery connected to your solar system that stores surplus electricity your site doesn’t need at the time, instead of sending it to the grid.
Later, to avoid higher electricity prices or to keep your grid demand under the limit set by your network operator, the battery releases the stored solar electricity for your site to use.
When is it worth adding a battery to commercial solar?
A battery makes most sense when your solar panels regularly produce more electricity than your site needs at the time, and you can use that electricity later.
For example, a hotel with strong solar generation during the day and high electricity use in the evening may save more by adding a battery than a factory that already uses most of its solar as it is generated.
Before buying a battery, check whether you could use more of your solar when it is being generated. If you can schedule some electricity-heavy jobs like charging company vehicles and running laundry equipment for sunnier hours, you may need a smaller battery or none at all.
Is storing solar worth more than exporting it?
Storing solar is worth more than exporting it if the money you save by using it later is greater than the value of exporting it back to the grid. Exporting solar is worth more if the export payment is higher than the saving from storing the electricity and using it later.
Let’s say your solar panels produce 100 kWh more than your site needs to operate. You can export it for 8p per kWh, or store it and use it later when electricity from the grid costs 28p per kWh.
Assume the battery gives you 90 kWh back for every 100 kWh you put in. Some electricity is always lost during charging and discharging. This is how it works out:
| Choice | Value from the same 100 kWh of spare solar |
|---|---|
| Export it | You receive £8. |
| Store and use it | You avoid buying 90 kWh at 28p per kWh, saving £25.20. |
On those figures, storing the solar for later use is worth £17.20 more than exporting it, before allowing for the cost of the battery, software, maintenance and wear.
If your export rate is higher, exporting may be worth more. At 26p per kWh, exporting the same 100 kWh would earn £26. That is 80p more than the £25.20 you would save by storing it.
What size solar battery does your business need?
The right battery size depends on how much spare solar electricity you have, how much of it you can use later and how quickly you need the battery to charge up and then discharge to power your site. Just knowing how much electricity you use in a year doesn’t tell you everything you need to know.
Here’s why. There are two main battery size measurements:
- Capacity, measured in kWh: how much electricity the battery can store.
- Power, measured in kW: how quickly the battery can charge or supply electricity.
For example, if your site needs 20 kW of power for three hours, the battery would need to supply 60 kWh in total. In fact, it’s a little bit more than that because all batteries lose some energy when charging and discharging.
To work out the right size for your site, you need to give your installer a full year of half-hourly electricity data. If you have solar, they’ll also need your solar generation, imports and exports to get a full and accurate picture of how much electricity your site uses and when, and how much spare solar is available to store.
If you don’t have solar but want to install a solar-and-battery system, your installer will estimate how much electricity the panels will generate, taking account of seasonal changes, shutdowns and planned additions to your site electrical equipment like EV chargers.
Ask your installer to test the proposed battery across a full year. They should show how often the battery is likely to fill up while your solar panels are still producing more electricity than your site needs. Once the battery is full, the extra electricity either goes back to the grid, if your site has permission to export electricity, or your solar panels have to produce less.
They should also show how often it is likely to run empty, meaning you would have to buy more electricity from the grid at the times you were hoping to use the battery. If that happens regularly, you may need more storage.
Finally, ask how quickly the battery can take in electricity from your solar panels. If your panels are producing 80 kW more than your site needs but the battery can only charge at 40 kW, it cannot store all of that spare electricity at once. That may mean you need a battery with a higher charging power.
Does the software that controls your battery make a difference?
The control software decides when to charge, when to supply your site and when to keep electricity stored for later. Its decisions directly affect how much spare solar you store and how much expensive grid electricity you avoid buying.
There are two types of control software - fixed control and flexible control.
Fixed control
Fixed control tells your battery to charge and discharge at set times. Those times stay the same until someone, like your installer or software provider, changes them.
For example, it might be set up to charge from the grid overnight when electricity is cheaper, then supply your site later when prices are higher.
That can work well if your electricity use, solar generation and prices are consistent and predictable most days.
The problem is, especially in temperate climates like Great Britain and the island of Island, weather can change from one day to the next. So, if tomorrow is sunnier than expected, a battery filled overnight may have less room for the spare solar electricity. If your busiest period starts later than usual, the battery may supply your site too early.
If tomorrow looks different from today, the battery still follows the same timetable.
Flexible control
Flexible control software gets direct feeds of:
- Electricity prices
- Expected solar generation
- How much power your site is using
- How much electricity is already stored in the battery
It uses this information to decide whether the battery should charge, supply your site or keep electricity stored for later.
If any of that information changes, such as tomorrow’s cloud forecast, the software runs the calculation again and can give the battery different instructions.
That means when the weather, prices or your site’s electricity use change, the times your battery charges and supplies your site can change too.
What does commercial solar battery storage cost?
There is no standard set price for a commercial solar battery setup. Current UK guides give very different figures. Some suggest around £200 to £450 per kWh installed, while others put 50 to 500 kWh systems at around £400 to £700 per kWh. Treat these as rough budgeting figures rather than prices for your site.
For your investment decision, the more useful figure is how much the battery adds to the cost of the solar project.
If you are installing new solar, ask your installer for two quotes based on exactly the same solar system: one for solar alone and one for solar plus a battery. The difference shows what adding the battery will cost you.
If you already have solar, ask for the full cost of adding the battery to your existing system.
Make sure the price includes the same things when you compare quotes:
| Your quote should show | What you need to know |
|---|---|
| Battery and inverter | The exact equipment and its kWh capacity and kW power. |
| Installation and electrical work | What has to be added or changed at your site. |
| Grid connection work | Any costs involved in getting permission to connect or export electricity. |
| Control software and setup | The software, controller, testing and setup needed to run the battery. |
| Ongoing costs | Software, monitoring and maintenance charges you will continue paying. |
A cheaper battery quote can become the more expensive option once these other costs are added.
How do you calculate the battery's payback?
Adding a battery increases your annual savings and the cost of the project. So, solar alone may pay you back sooner even if, over the longer term, a solar plus battery setup means you’re better off.
Take this hypothetical example:
- Solar only: costs £50,000 and saves £10,000 a year.
- Solar + battery: costs £80,000 and saves £14,000 a year.
Solar alone pays back in five years while solar plus battery pays back in about 5.7 years.
However, the battery increases the annual saving by £4,000. This means the savings the battery delivers gradually catches up with the £30,000 you spend on it.
| End of year | Solar only | Solar + battery |
|---|---|---|
| 5 | Initial cost recovered | £10,000 still to recover |
| 6 | £10,000 ahead | £4,000 ahead |
| 7 | £20,000 ahead | £18,000 ahead |
| 8 | £30,000 ahead | £32,000 ahead |
| 10 | £50,000 ahead | £60,000 ahead |
In this example, solar alone leaves you better off for the first 7.5 years because it costs £30,000 less at the start.
After 7.5 years, the extra £4,000 a year the battery saves you has covered in its entirety the £30,000 difference. And from that point on, solar plus battery leaves you £4,000 further ahead each year, assuming the savings you make stay static.
Project payback should not be the only figure you consider. A shorter payback shows you the option that covers its costs faster but that doesn’t mean it delivers the most value of the full life of the system, which for a battery and solar combination, can be 15-20 years, sometimes more.
Ask your installer to show your expected financial position for solar alone and solar plus battery over the same number of years.
Make sure both calculations use the same solar design, electricity use and tariff assumptions. Your installer should not count the same saving twice. For example, solar electricity your site would already have used directly belongs in the solar-only calculation, so it cannot also be counted as a battery saving.
If the battery stores solar electricity you could otherwise sell to the grid, your installer should deduct the export income you would have received.
Before you commit, scenario-test by asking the installer to run multiple versions of the calculation with different electricity prices, export payments, and spare solar. This way, you can see how quickly the financial case weakens if the original assumptions turn out to be too optimistic.
Could your solar battery save more with GridVolt?
GridVolt Energy Manager adds flexible control to compatible third-party batteries and inverters.
It uses your tariff, electricity use and expected solar generation to decide when the battery should charge, supply your site or keep electricity stored for later. It forecasts demand and solar generation for the next 48 hours and recalculates the battery schedule every 15 minutes.
In one agricultural deployment, Energy Manager increased the savings from an existing battery by 41% during its first 70 days. That was the result from one site, not a typical or guaranteed saving.
GridVolt does not sell battery hardware. If you already have a battery, tell us about your setup and we can check compatibility and show you how our software delivers long-term and higher savings. If you’re looking to install a battery system, let us know and we can put you in touch with a trusted partner.
Fill in the form on the right, or use our contact page to get in touch.
Frequently asked questions
Can you add a battery to existing commercial solar?
Often, yes. Your installer first needs to check whether the battery, inverter and control software can work with the solar equipment you already have. They should also check whether your site needs any electrical work and whether adding the battery affects warranties or insurance.
In Great Britain, adding a battery may also affect your grid connection. Ask your installer to check this with your Distribution Network Operator (DNO) before they finalise the design. Our G99 application guide explains this in more detail.
Will a commercial solar battery provide backup during a power cut?
Not automatically. To keep equipment running during a power cut, the battery system needs extra equipment that can safely disconnect your site from the grid and supply the circuits you want to keep running. Tell your installer which equipment must stay on and for how long. Any electricity kept in the battery for backup cannot be used to cut your electricity bill at the same time.
Do you need solar panels to use a commercial battery?
No. Your business can charge a battery from the grid when electricity costs less, then use that stored electricity later when grid prices are higher or your site needs more power. Our commercial battery storage guide covers battery uses beyond solar.
Can you add more battery capacity later?
Sometimes. It depends on the battery system you buy. Ask your installer before you buy whether the system can accept more battery modules later. They should also check whether the inverter can handle the extra capacity and whether adding more storage would require changes to your grid connection. Do not assume another battery from the same manufacturer will automatically work with your existing system.
Does the same advice apply in Ireland?
The basic principles of storing solar electricity are the same, but businesses in Ireland follow different grid and electricity-market rules from businesses in Great Britain. If your site is in the Republic of Ireland or Northern Ireland, use the local tariffs, connection rules and other costs when working out whether a battery makes financial sense. Our battery storage in Ireland guide covers the Irish market in more detail.