If you’re interested in solar panels, there’s a good chance that a solar consultant has tried to upsell you a solar battery. Does that sound familiar?
They’re just trying to save you money long-term.
Solar batteries are great for collecting the unused energy your solar system produces during the day for use at night. They’re also incredibly useful for backing up your home during a power outage. Not to mention how they can generate passive income for your home when you sign up for a virtual power plant (VPP) and take advantage of variable feed-in rates.
If that sounds like a lot, don’t worry. Penrith Solar Centre has you covered. We install solar batteries all day, every day. It’s what we do. We’re here to guide you through the rocky terrain of information. While we are a touch biased (we sell solar batteries), we’re going to present an unbiased perspective on battery storage.
In this article, you will learn about:
- How Do Solar Batteries Work?
- How Does a Solar Battery Save Money?
- What is the NSW Battery Rebate Program?
- How Does a Virtual Power Plant (VPP) Lower My Energy Bills?
By the end of this article, you’ll thoroughly understand how a solar battery will lower your electric bills.
How Do Solar Batteries Work?
Here’s what they do:
Store Excess Solar Energy
During sunny days, especially in the summer, your solar panels produce more energy than your home can use.
Instead of sending that excess energy back to the grid for a feed-in tariff, your solar battery stores it for use at another time.
Powers Your Home at Night (or On Cloudy Days)
A solar battery helps combat solar panels’ greatest foe: shade. Cloud cover creates shade and solar doesn’t work at night. A battery helps you troubleshoot this inherent problem.
Other Solar Battery Advantages
And while we all love the financial benefits of solar batteries, it’s important to note how important they are in reducing greenhouse gas emissions by incrementally shifting energy use from power plants to your own roof.
Another thing that solar batteries do is offer blackout protection in the event of a power outage. The stored energy can keep medical devices, WiFi, and of course, the lights on when there’s a storm.
If you’re interested in learning a bit more about solar batteries, you might want to start with the following article titled, Adding a Battery to a Solar System.
How Does a Solar Battery Save Money?
We touched on the fact that solar batteries save money by shifting your energy use away from the grid, but we didn’t dive too deep into it. Let’s do it here:
Peak, Shoulder, and Off-peak Rates
For anyone who doesn’t have an energy bill handy, your energy usage is charged differently depending on the time of day. Importing energy from the grid costs different prices at different times. They are:
- Peak Hours: highest rates, typically in the evening between 5 PM and 9 PM (give or take an hour), but it varies from energy retailer to retailer.
- Shoulder Hours: the rates are moderately priced, used on the weekend or at different times in the morning or afternoon depending on your energy retailer.
- Off-peak Hours: lowest rates, typically overnight between 10 PM or so and 7 AM or so.
If you program your solar battery to discharge during peak hours, you will save money. How much money depends on how much electricity costs, how you use it, and what your battery’s specs are (size and discharge power rate).
You’re simply not paying your energy retailer during expensive evening prices. It’s how a solar battery saves you money. Especially if you use more power in the evening.
If you’re interested in learning a bit more about the benefits of solar batteries, you might want to start with the following article titled, 7 Benefits of Adding a Battery to Your Solar System.
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What is the NSW Battery Rebate Program?
The NSW Battery Rebate is a new incentive under New South Wales’s Peak Demand Reduction Scheme (PDRS). It’s designed to help reduce energy use during peak hours by incentivising the installation of solar batteries.
The NSW government estimates that eligible customers can save up to $4,000 as an upfront discount on the battery installation.
If you connect your battery to a Virtual Power Plant (VPP), you can receive an additional $400 as a cashback incentive, which can be earned twice within the battery’s warranty period (as long as 6 years of warranty coverage remain).
Eligibility Requirements
- You must live in New South Wales and own solar.
- The rebate only applies to eligible solar battery systems.
- Eligibility requirements can be found here.
Steps to Apply for the Rebate
- Step 1: Choose an approved certified installer from the quotes you received or the NSW government website.
- Step 2: Confirm eligibility for the rebate with your installer by selecting an approved battery.
- Step 3: Purchase the battery and have it installed.
- Step 4: When you pay for your battery, the rebate amount will be deducted from the upfront price as a discount.
The rebate will reduce your payback period for your solar battery by at least a year in most cases. If you use a lot of energy, the battery payback period will be even shorter with the assistance of the battery rebate.
If you’re interested in learning a bit more about the upcoming solar battery rebate, you might want to check out the following article titled, Everything You Need to Know About the Home Battery Rebate for NSW.
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How Does a Virtual Power Plant (VPP) Lower My Energy Bills?
What is a Virtual Power Plant (VPP)?
A Virtual Power Plant (VPP) is a network of solar batteries connected and controlled via cloud-based software. It’s something you have to sign up for.
The software instructs connected batteries to discharge to relieve the grid when it needs extra energy. It’s like having a mini power plant spread out and made up of many solar batteries rather than a huge, central generator fuelled by coal.
To thank you for helping them keep the grid functioning without any blackouts, VPP programs pay you for exporting energy into the grid. It used to be called a feed-in tariff but has been rebranded as a time-of-use tariff.
How a VPP Works with a Solar Battery
In the evening, during peak hours when demand from the grid is high, a VPP will draw small amounts of energy from participating solar batteries.
In exchange for this energy, VPP members receive payments, some of which can be quite lucrative over time.
Not to mention, you’ll help your community avoid a blackout.
If you’re interested in learning a bit more about VPPs, you might want to check out the following article titled, What is a Virtual Power Plant (VPP)?
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Is a Solar Battery Worth the Investment for Your Household?
Consider Your Energy Usage:
- A battery is most beneficial for households with high evening or nighttime energy use.
- If you often use appliances during peak hours, a battery can help you avoid high grid costs.
Household Budget and Upfront Costs:
- Batteries have high upfront costs, even with rebates.
- Consider the NSW rebate and potential VPP income to reduce initial expenses.
Local Electricity Rates and Potential Savings:
- Higher grid rates make a battery more cost-effective.
- Households in areas with frequent peak pricing may benefit most.
Additional Benefits:
- Provides backup power during blackouts, which is valuable for essential medical equipment.
- Increases energy independence by relying less on grid electricity.
At Penrith Solar Centre, we understand the newness of everything battery-related. After all, you might not even have considered a battery before now. Don’t worry, we’re here to answer your questions and guide you through our Learning Centre.
If you’re interested in learning a bit more about the ins and outs of solar batteries, you might want to start with the following article titled, 7 Considerations for Choosing a Solar Battery.
