Home Battery Payback Calculator
Model one battery cycle as discharged energy that avoids an expensive rate minus the extra charging energy bought—or solar export value forgone—after round-trip losses.
Quick answerWith the defaults, delivering 10 kWh requires about 11.11 kWh of charging energy at 90% round-trip efficiency. Avoiding $0.30/kWh while charging at $0.08/kWh saves about $2.11 per full cycle, $768 per year at seven cycles per week, and gives an 11.7-year simple payback on a $9,000 installed cost.
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Infinity means the modeled rate spread does not produce positive annual savings.
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How it works
Charging energy = usable discharged energy ÷ (round-trip efficiency ÷ 100). Saving per cycle = discharged energy × avoided peak rate − charging energy × charging cost. Annual saving = saving per cycle × cycles per week × 52. Simple payback = installed cost ÷ annual saving, only when annual saving is positive.
Battery payback at different cycle frequencies
A $9,000 battery delivering 10 kWh per full cycle, 90% efficiency, $0.30/kWh avoided rate and $0.08/kWh charging cost.
| Full cycles / week | Annual saving | Simple payback |
|---|---|---|
| 1 | $110 | 82.0 years |
| 3 | $329 | 27.3 years |
| 5 | $549 | 16.4 years |
| 7 | $768 | 11.7 years |
Rounded values use 52 weeks per year and exclude degradation, maintenance, financing and replacement.
Worked example with losses counted correctly
At 90% round-trip efficiency, delivering 10 kWh requires 10 ÷ 0.90 = 11.11 kWh of charging energy. The discharge avoids 10 × $0.30 = $3.00. Charging costs 11.11 × $0.08 = $0.89. Saving per full cycle is therefore $3.00 − $0.89 = $2.11.
At seven equivalent full cycles each week, annual saving is $2.11 × 7 × 52 = about $768, and $9,000 ÷ $768 = an 11.7-year simple payback. The previous shortcut of multiplying usable capacity by efficiency and then by the rate spread mixed input and output energy; this model keeps them separate.
Solar charging still has an opportunity cost
Surplus solar is not automatically free. If the utility would pay $0.05/kWh for exports, charging the battery gives up that payment. Enter $0.05 as the charging value, then let round-trip losses increase the amount of solar needed to deliver one kWh later.
Use zero only for energy that would otherwise be curtailed or receive no credit. If the battery also increases solar self-consumption, compare the avoided import rate with the export value at the actual charge and discharge times.
Cycle frequency must come from real dispatch
One cycle per day is an assumption, not a guarantee. NREL's residential battery benchmark uses approximately one cycle per day for its modeled performance, while actual household dispatch can be much lower when rate windows, weather, reserve settings or solar surplus do not support a full cycle.
Add partial cycles together: five 20% discharges equal one equivalent full cycle. A year of monitoring or an installer simulation using your interval data is stronger than assuming seven full cycles every week.
Simple payback omits ownership and backup value
The calculation excludes degradation, warranty throughput limits, future capacity loss, maintenance, inverter replacement, standby consumption, demand charges, financing and changing tariffs. NREL's SAM battery model uses detailed dispatch, temperature and degradation behavior because these factors can materially change lifetime economics.
Backup power may have personal value even when bill savings alone do not repay the system. Keep that resilience value separate from energy-cost savings so the financial result remains transparent.
Sources used for assumptions: NREL — 2024 Residential Battery Storage benchmark; NREL System Advisor Model — Battery Storage.
Frequently asked questions
What is round-trip efficiency?
Useful energy discharged divided by energy used to charge. At 90%, delivering 9 kWh requires 10 kWh of charging energy.
What should I enter for usable capacity?
Enter the energy you expect to discharge within reserve, depth-of-discharge and warranty limits—not necessarily the battery nameplate capacity.
What counts as one battery cycle?
One equivalent full cycle is discharge totaling 100% of the modeled usable energy. Two 50% discharges or five 20% discharges equal one full cycle.
What if I charge from solar?
Enter the export payment or other value you give up by storing that solar. Use zero only when the energy would otherwise have no value or be curtailed.
Why does the calculator divide by efficiency?
Capacity is modeled as energy delivered from the battery. Losses mean more energy must be purchased or diverted into charging than is later discharged.
What if annual savings are negative?
The rate spread is too small for the entered losses and schedule. The page shows no finite payback because cycling would increase modeled energy cost.
Does this include backup-power value?
No. Resilience is personal and outage-dependent. Add it separately rather than disguising it as guaranteed bill savings.
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