The Ultimate Buyer's Guide for Purchasing Residential Solar Battery Storage Systems

As electricity costs continue to rise, solar panels are a smart way to tap into efficient and clean energy from the sun. A recent CNET survey found that 78% of US adults are worried about rising home energy bills, and 70% are actively taking steps toward energy efficiency. If you’re thinking along the same lines, now might be the right time to explore solar power. Installing solar panels and connecting them to the grid can help reduce your monthly bills and cushion costs when the sun isn’t shining. But if you want real energy independence, you’ll need to get a solar battery. Without one, even a roof full of solar panels won’t help during a grid outage -- you’ll still be left in the dark.

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"Something that people don't consider is that if they're on natural gas, and the power goes out in the winter, they think their heater is going to work, but most have an electric fan, so if the power goes out you still need something," said Mike Murphy, owner of Utah-based PrepSOS, which sells solar batteries, generators and other emergency-preparedness equipment.

Plenty of folks, including those in a recent Reddit thread, often wonder if solar batteries are worth the investment. The short answer is absolutely. A battery completes your solar setup, giving you access to stored solar energy day or night and can keep your lights on and essential devices powered during emergencies. Plus, if your area supports net metering, you could knock extra money off of your electric bill by selling surplus energy back to the grid when it’s most valuable.

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Solar batteries come with a price tag, and choosing the right one can feel overwhelming. That’s where we come in. This guide breaks down everything you need to know to shop smart and find the right solar battery for your home.

How solar batteries work

The simplest way to think of batteries is to imagine that the electricity in your house flows through wires in much the same way as water through plumbing. Batteries fill the role of a storage tank, making electricity readily available when it's needed, just as indoor pressure tanks and water heaters do with water. When batteries are tapped for energy, their reserve of stored electricity is depleted, but in a properly wired system, they can be automatically replenished by "catching" any excess electricity flowing through the system from sources like solar panels or the grid.

Depending on your goals for installing batteries, your system might look a bit different.

1. Connect just to solar panels: Batteries connected only to solar panels will fill when the sun shines and will discharge when you use electricity and the sun is down or behind clouds. It's one option if you are off-grid and away from electrical utilities.

2. Connect to solar panels and to the grid: If you have a solar inverter that can temporarily disconnect you from the grid, you have what's known as a hybrid solar system. In such a system, you can charge your battery with your solar panels or the grid and use the energy stored there in your home or send it back to the grid and save some money via rate arbitrage (if you have time-of-use rates). A hybrid system can also keep your house powered during a power outage.

3. Connect just to the grid: While we wouldn't call them solar batteries, you can install batteries without solar panels at all. They would charge from the grid and would be useful for backup power or for enrolling in a virtual power plant.

Pros and cons of solar batteries

The pros and cons of buying a battery largely boil down to savings (and backup power) versus cost.

The extra solar electricity you store in your solar batteries can be used in place of electricity you'd normally have to buy from your utility, or sold back to the grid when it's most valuable. This can save you some money and relieve some pressure on the grid when there's peak demand. (Whether this is a viable money-saving option for you depends on your utility's net metering rules.)

Some companies are starting to allow people to enroll their batteries in virtual power plants, a fleet of batteries, smart thermostats and other household appliances that work together to decrease demand on the grid. Where available, virtual power plants might come with additional perks for the battery owner.

In addition, you'll be able to use your battery bank in the event that the grid goes down due to a failure, natural disaster or even a solar flare.  A backup generator can also help keep the power on in an emergency (and charge your batteries), but it requires burning fossil fuels, usually either gas or propane.

Batteries do add considerable expense to your home energy system, but federal tax credits and other incentive programs usually can be applied to the cost of storage.

Different types of solar batteries 

There are several kinds of batteries used in battery backup systems, including lithium-ion and lead-acid batteries. Here's a quick overview.

Lithium-ion batteries

There are multiple lithium chemistries on the market, including nickel-manganese-cobalt, lithium polymer and lithium iron phosphate. The latest lithium technology comes with less danger of fire than older headlines might lead you to believe. They're capable of a deeper discharge than lead acid batteries (you can use up to 90% of a charge per cycle without inflicting much damage) and are much easier to maintain with a longer lifespan. They're also significantly more expensive and sensitive to temperature. Increasingly, they are becoming standard in residential solar applications.

Lead-acid batteries 

The basics of this technology are essentially unchanged for over a century. They remain inexpensive and widely available. For solar systems, it's popular to use somewhat more expensive sealed batteries that require less maintenance and eliminate the risk of dealing with a potential acid spill and hydrogen off-gassing. For a while, sealed lead acid seemed to be the future of solar batteries.

However, all lead acid batteries require more careful monitoring of charge levels compared with lithium-ion and can't compete in terms of efficiency, energy and lifespan but are a good and plentiful budget alternative. 

Flow batteries

Flow batteries (or redox flow batteries) are less common in home systems since they're mainly designed for commercial use. The technology appears promising, and it could become more widely used in residential battery backup systems in the near future.

Nickel-cadmium batteries

Nickel-cadmium batteries have a high energy density with double the energy of a lead-acid battery. Nickel-cadmium batteries are very durable, expensive and work well in extreme temperatures making them a good choice for large-scale commercial and industrial projects. Cadmium is toxic and generally not appropriate for residential use.

Buying a backup battery system

In general, a solar battery bank can cost between $10,000 to $25,000 for 10 to 25 kilowatt hours of power. (The US Department of Energy says solar batteries can cost anywhere from $12,000 to $22,000.)

That said, it ultimately comes down to your budget and energy needs. A small off-grid solar system with enough battery capacity for the basics (no air conditioning or electric heaters allowed) using a pair of high-capacity flooded lead acid batteries can be had for $500 total. Upgrading to lithium-ion costs $1,300 for a system with comparable capacity. 

Adding batteries is a significant expense for any system, but the good news is that nearly a third will come back to you in the form of the 30% federal renewable energy tax credit. Other incentives may also be available from state and local governments, utilities, and even credit unions.

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How to set up a battery backup system

It's best to use a certified solar installer or electrician to install your solar batteries and connect them to your solar array, your home, the grid and an EV charger if you desire. You should expect to spend a few thousand dollars for the labor involved, and there may be additional components like inverters, charge controllers and EV charge stations that can also add hundreds or thousands of dollars in expense.

If you have confidence in your DIY skills and experience with electricity, it is possible to install batteries yourself. Just be sure to check with local regulations, building codes and equipment warranties.

If you go the DIY route, make sure all batteries are the same age (ideally new). Don't mix new batteries with older ones to help make sure they charge evenly.

Maintaining a battery backup system

For all batteries, follow any manufacturers' instructions regarding monitoring the depth of discharge. Generally, for lead acid batteries, this means trying to keep them over half charged as much as possible. Many lithium-ion batteries can safely be taken down to only 10% charge. Flooded lead-acid batteries also need to be topped off with distilled water a few times a year.

Lifespan and warranties

A few years after installation, you may notice that your battery backup system doesn't hold a charge as well as it used to. That's because, like other types of batteries, battery backups lose storage capacity over time. 

To account for this, battery backups include a warranty that expresses how efficient the battery should be by the end of the warranty period. Many of the top solar batteries offer 10 years and 70%, meaning that by the end of the 10-year warranty, the battery should still operate at 70% of its original performance. Lead acid battery warranties typically last for two to five years.

Inverters and batteries 

Inverters play an important role in how the battery stores and converts solar energy. While solar panels generate electricity in direct current, the electric grid and homes generally use alternating current. An inverter can convert AC to DC or vice versa, and most solar batteries include an inverter to store the energy in DC form, as well as an inverter to convert it back into AC to be used in the grid or the home.

Because inversion of current isn't perfectly efficient, battery producers are always experimenting with how to invert less often and increase the efficiency of the battery. As a result, some batteries will not have inverters for both input and output included in the system. Talk to your solar installer about the battery system you're considering so that you can make sure you have all the external inverters you need.

Beware cheap inverters, which are everywhere. To power modern household appliances, a pure sine wave inverter is essential; otherwise, you may end up frying some of the more delicate electronic circuits in your home.

When you picture a battery, the first thing to come to mind is probably the disposable batteries you put in everyday appliances like your TV remote. But did you know you can power your entire house with (much larger) batteries?

You don't need a home solar panel system to reap the benefits of home battery backup. But you'll get the most out of your system when you pair them together—especially if your utility doesn't pay you much for the excess electricity your solar panels generate and send to the grid. 

We explain how to decide if backup batteries are right for you and, if so, how to get a battery system that fits your needs at the best price.

Home backup batteries store extra energy so you can use it later. When you only have solar panels, any electricity they generate that you don’t use goes to the grid. But with residential battery storage, you can store that extra power to use when your panels aren’t producing enough electricity to meet your demand.

Most batteries have a limit on how much energy you can store in one system, so you may need multiple batteries if you want to have enough capacity for long-duration backup. Also, most batteries can’t store electricity forever—even the best home battery backups will slowly lose charge over time, whether or not you use them.

You don't need solar to install a home battery, but batteries only store energy, they don't produce it. Pairing your battery system with solar panels allows you to truly increase your grid independence and your electric bill savings. Here's how it works: 

But home backup batteries are becoming an increasingly popular choice over home generators. They offer many of the same backup power functions as conventional generators without the need for refueling. While they're more expensive upfront and require an electrician to install, you can "refuel" them for free with the sun's energy if paired with solar panels. They're also much quieter than generators and don't come with emissions-related health concerns.

Most batteries last about 10-15 years, meaning you'll have plenty of time to break even on your investment. While many homeowners can benefit from installing a battery system, they're not right for everyone. Here are a few questions to answer when deciding if you should add a home battery:

Power outages are an occasional nuisance for everyone, but for some people, they're a far too regular occurrence: According to the Energy Information Administration, the average U.S. electricity customer experienced 5.5 hours of electricity interruptions in . However, customers in Florida, West Virginia, Maine, Vermont, and New Hampshire experienced average outages ranging from 10.3 hours in New Hampshire to 19.1 hours in Florida.

Under these policies, you could still have a hefty electric bill even with solar. By pairing your solar panels with a battery, you can program your system to export electricity to the grid only when compensation rates are high and pull from your battery when rates are low, maximizing your savings.

Even if you don't have solar, batteries alone can be worth it if your utility uses a complex electricity rate structure. Time-of-use, or TOU, rates are a form of "time-varying rates" designed to better reflect the actual cost of electricity based on the amount of supply and demand. Utilities have used TOU rates for businesses for many years, but they're becoming an increasingly common way to charge homeowners. Under TOU rates, your electricity cost will vary from hour to hour, day to day, and season to season. With a battery, you can use your stored energy to avoid pulling electricity from the grid when it costs the most. 

Demand charges are also common for businesses and are becoming more common for homeowners. With demand charges, your utility company tracks your maximum energy pull from the grid during any given hour (or even 15-minute period) per month and charges you based on that maximum demand for the whole month. With a battery, you can lower your peak demand from the grid, driving significant bill savings.

If you want to install a home battery but are overwhelmed by the cost, rest assured there are plenty of incentives available that can significantly lower the price. Depending on where you live, you could break even on your home battery storage investment in less than a year. Here are some of the top battery incentives that will either reduce your upfront cost or increase your long-term savings:

In , a 10 kWh battery costs about $7,000 after the federal tax credit based on thousands of quotes through EnergySage.  This price tag is high, but if you've determined that a battery is right for you based on your answers to the questions we outlined so far, it will pay off over time. 

But if you live somewhere with net metering and a flat, non-time varying electricity rate, the only financial savings from installing energy storage come from avoiding outages or receiving any available state incentives. In those instances, you won't see any more bill savings from adding a battery to your solar panel system.

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