Why would you consider a home battery?
When paired with a home solar system, home batteries can:
- Reduce your dependence on your utility
- Power your home or certain appliances in the event of a grid outage
- Save money on your energy bill
- Some combination of the above
If you’re considering a home battery, it’s critical to have a clear understanding of what you want your home battery to do. How you intend to use a home battery will determine the type, size and cost of the home battery system.
Why would you consider a home battery?
When paired with a home solar system, home batteries can:
- Reduce your dependence on your utility
- Power your home or certain appliances in the event of a grid outage
- Save money on your energy bill
- Some combination of the above
If you’re considering a home battery, it’s critical to have a clear understanding of what you want your home battery to do. How you intend to use a home battery will determine the type, size and cost of the home battery system.
5 ways a home battery can be used
| Intended use | Goals | Pros | Cons | Battery Cost | Home Solar Impact |
|---|---|---|---|---|---|
| Whole home backup | Be able to power your home for an extended period of time during a power outage. | Power for your entire home during power outages | Battery capacity sits idle most of the time | $$$$$ | Larger home solar system needed |
| Critical load backup | Be able to power select critical loads for a period of time during a power outage | Electricity available for certain appliances during power outage | Battery capacity sits idle most of the time | $$$ | Slightly larger home solar system |
| Energy independence | Reduce or eliminate energy purchases from your utility | Independence from your utility | Higher cost than solar only | $$ | Same or slightly larger home solar system |
| Load & rate shifting | Save money by storing energy instead of selling it to the utility at off-peak times and being able to use the stored energy during peak times | Over time, energy savings helps offset the cost of the battery | Financial returns only apply under time of use rate structures | $$ | Same or slightly larger home solar system |
| Off-grid | Power a home which is not connected to the grid | No grid or utility needed | Higher cost than solar only | $$$$ | Larger home solar system needed |
5 ways a home battery can be used
| Intended use | Goals | Pros | Cons | Battery Cost | Home Solar Impact |
|---|---|---|---|---|---|
| Whole home backup | Be able to power your home for an extended period of time during a power outage. | Power for your entire home during power outages | Battery capacity sits idle most of the time | $$$$$ | Larger home solar system needed |
| Critical load backup | Be able to power select critical loads for a period of time during a power outage | Electricity available for certain appliances during power outage | Battery capacity sits idle most of the time | $$$ | Slightly larger home solar system |
| Energy independence | Reduce or eliminate energy purchases from your utility | Independence from your utility | Higher cost than solar only | $$ | Same or slightly larger home solar system |
| Load & rate shifting | Save money by storing energy instead of selling it to the utility at off-peak times and being able to use the stored energy during peak times | Over time, energy savings helps offset the cost of the battery | Financial returns only apply under time of use rate structures | $$ | Same or slightly larger home solar system |
| Off-grid | Power a home which is not connected to the grid | No grid or utility needed | Higher cost than solar only | $$$$ | Larger home solar system needed |
How does a home battery work with a home solar system?
A home battery stores excess energy generated by your home solar system. The energy stored in your home battery is then used during the night, on a cloudy day or in the event of a power outage when your home solar system isn’t producing enough energy to meet your home’s needs. Even though technically your home battery can be charged with electricity from the grid, your home solar system should be the primary source of energy for charging your home battery.
So how is a home battery system connected with a home solar system? There are two options: AC-coupled and DC-coupled.
AC-coupled batteries are connected to a source or sources of AC electricity, for example the utility grid or the output of a solar inverter. In order to charge the battery, the AC electricity needs to be converted back to DC electricity. This is typically done with a special type of inverter which is built-in to the battery system, called a bi-directional, hybrid or multi-mode inverter. Some refer to it as “bi-directional” since it performs the function of converting AC electricity into DC electricity to charge the battery, but can also convert DC electricity from the battery into AC electricity when it needs to be used in your home. Others refer to it as “hybrid” or “multi-mode” since it can operate in the presence or absence of the grid.
The benefit of an AC coupled home battery system is its flexibility since it can be connected to any source of AC electricity. This means that it can be easily incorporated into any home solar system and actually could be installed even if you don’t have a home solar system.
AC-coupled home batteries are suitable for any situation, but if you want to add a home battery to an existing home solar system, you’ll want to go with an AC-coupled home battery.
Remember that solar panels produce DC electricity and that home batteries store DC electricity. DC-coupled home batteries are effectively connected directly to your home solar panels with a charge controller in between. A charge controller (built in to the home battery) regulates the flow and voltage / current characteristics of the DC electricity which is feeding the battery. When electricity is needed from the battery, an inverter (also typically built in to the battery) converts the DC electricity from the battery to AC electricity for use in your home.
The advantage of a DC-coupled home battery is that you have less electrical loss when compared to an AC-coupled home battery. With an AC-coupled home battery, the system will convert DC electricity from the solar panels to AC electricity and then back to DC electricity to charge the battery. Compare this process to a DC-coupled home battery which can be charged directly with DC electricity produced by your home solar system. Every time you convert from AC to DC or DC to AC, you lose 1-2% of that energy. This doesn’t seem like much but can add up over time.
DC-coupled home batteries are best suited for systems which use DC optimizers or for off-grid applications.
How does a home battery work with a home solar system?
A home battery stores excess energy generated by your home solar system. The energy stored in your home battery is then used during the night, on a cloudy day or in the event of a power outage when your home solar system isn’t producing enough energy to meet your home’s needs. Even though technically your home battery can be charged with electricity from the grid, your home solar system should be the primary source of energy for charging your home battery.
So how is a home battery system connected with a home solar system? There are two options: AC-coupled and DC-coupled.
AC-coupled batteries are connected to a source or sources of AC electricity, for example the utility grid or the output of a solar inverter. In order to charge the battery, the AC electricity needs to be converted back to DC electricity. This is typically done with a special type of inverter which is built-in to the battery system, called a bi-directional, hybrid or multi-mode inverter. Some refer to it as “bi-directional” since it performs the function of converting AC electricity into DC electricity to charge the battery, but can also convert DC electricity from the battery into AC electricity when it needs to be used in your home. Others refer to it as “hybrid” or “multi-mode” since it can operate in the presence or absence of the grid.
The benefit of an AC coupled home battery system is its flexibility since it can be connected to any source of AC electricity. This means that it can be easily incorporated into any home solar system and actually could be installed even if you don’t have a home solar system.
AC-coupled home batteries are suitable for any situation, but if you want to add a home battery to an existing home solar system, you’ll want to go with an AC-coupled home battery.
Remember that solar panels produce DC electricity and that home batteries store DC electricity. DC-coupled home batteries are effectively connected directly to your home solar panels with a charge controller in between. A charge controller (built in to the home battery) regulates the flow and voltage / current characteristics of the DC electricity which is feeding the battery. When electricity is needed from the battery, an inverter (also typically built in to the battery) converts the DC electricity from the battery to AC electricity for use in your home.
The advantage of a DC-coupled home battery is that you have less electrical loss when compared to an AC-coupled home battery. With an AC-coupled home battery, the system will convert DC electricity from the solar panels to AC electricity and then back to DC electricity to charge the battery. Compare this process to a DC-coupled home battery which can be charged directly with DC electricity produced by your home solar system. Every time you convert from AC to DC or DC to AC, you lose 1-2% of that energy. This doesn’t seem like much but can add up over time.
DC-coupled home batteries are best suited for systems which use DC optimizers or for off-grid applications.
How much does a home battery system cost?
A recent MIT study determined that battery costs have fallen 97 percent since 1991. Despite the steep decline in price, a home battery system will cost at least $5,000 and can easily cost many tens of thousands of dollars if you want a lot of battery capacity. As batteries become more popular in home battery systems and electric vehicles, technology improvements and manufacturing scale will drive a home battery’s cost down further in the coming years.
So should you wait until home batteries get cheaper? We think it’s still worth considering a home battery system today. We’ll discuss the factors that influence cost and how you can benefit from a home battery system without breaking the bank.
As we said earlier, the most important factor in the cost of a home battery is how you intend to use it…
How much does a home battery system cost?
A recent MIT study determined that battery costs have fallen 97 percent since 1991. Despite the steep decline in price, a home battery system will cost at least $5,000 and can easily cost many tens of thousands of dollars if you want a lot of battery capacity. As batteries become more popular in home battery systems and electric vehicles, technology improvements and manufacturing scale will drive a home battery’s cost down further in the coming years.
So should you wait until home batteries get cheaper? We think it’s still worth considering a home battery system today. We’ll discuss the factors that influence cost and how you can benefit from a home battery system without breaking the bank.
As we said earlier, the most important factor in the cost of a home battery is how you intend to use it…
Sizing home battery capacity
The more information you have on your energy consumption, the more accurately you’ll be able to size your battery capacity and avoid paying for expensive capacity that you don’t need. In an ideal world, you’d have a year or more of data showing how much energy your home has used on an hourly basis. Some utilities can provide data on your energy use by the hour, but for those who don’t, the next best way is to approximate your energy usage by appliance.
To do this, start by finding the product information sticker on an appliance. The sticker should tell you how many watts of power the appliance consumes – you’ll need to calculate the watts by multiplying volts x amps if the wattage isn’t listed. From there, you can estimate how many hours per day that appliance would be used.
Let’s use a refrigerator that consumes 600 watts as an example. Let’s also assume that your refrigerator runs its cooling cycle for a total of 2 hours per day. 2 hours x 600 watts = 1,200 watt-hours or 1.2 kilowatt-hours. You can continue to do this for all the appliances you want to power and then add up the total kilowatt-hours needed per day. From there, you’ll need to estimate how many kilowatt-hours a day your home solar system will produce.
These calculations can get fairly complex so it’s best to find a home battery calculator on the internet. If you use Sentinel for your home solar design, we’ll do all the calculations for you.
Sizing home battery capacity
The more information you have on your energy consumption, the more accurately you’ll be able to size your battery capacity and avoid paying for expensive capacity that you don’t need. In an ideal world, you’d have a year or more of data showing how much energy your home has used on an hourly basis. Some utilities can provide data on your energy use by the hour, but for those who don’t, the next best way is to approximate your energy usage by appliance.
To do this, start by finding the product information sticker on an appliance. The sticker should tell you how many watts of power the appliance consumes – you’ll need to calculate the watts by multiplying volts x amps if the wattage isn’t listed. From there, you can estimate how many hours per day that appliance would be used.
Let’s use a refrigerator that consumes 600 watts as an example. Let’s also assume that your refrigerator runs its cooling cycle for a total of 2 hours per day. 2 hours x 600 watts = 1,200 watt-hours or 1.2 kilowatt-hours. You can continue to do this for all the appliances you want to power and then add up the total kilowatt-hours needed per day. From there, you’ll need to estimate how many kilowatt-hours a day your home solar system will produce.
These calculations can get fairly complex so it’s best to find a home battery calculator on the internet. If you use Sentinel for your home solar design, we’ll do all the calculations for you.
What incentives are available for home batteries?
Like home solar systems, if you obtain a battery via third-party ownership (for example, in conjunction with a solar lease or PPA), you are not eligible for any incentives since you don’t own the battery. Read more about third-party ownership for home solar here.
If you purchase your home battery system (including purchasing via a loan), and it is installed with or within one year of installing a home solar system, the cost of your home battery system is eligible for the Federal Solar Investment Tax Credit or ITC (26% of the total project cost in 2021). But the battery must be charged by the home solar system 100 percent of the time. If your batteries are charged by energy from the grid at all, they are technically not eligible for the ITC.
How do you know whether the batteries are being charged by the grid or your home solar system?
DC-coupled home batteries are connected to your solar panels and charged directly from the DC electricity that your solar panels produce. It’s pretty clear that a DC-coupled home battery is eligible for the ITC.
On the other hand, AC-coupled home batteries are physically connected to a source of AC electricity which could be the grid and/or the AC output of a home solar system’s inverter. Therefore, it’s less clear if the home battery system is being charged by the home solar system or the grid. So how do you know if your AC-coupled home battery is eligible for the ITC?
AC-coupled home batteries come with monitoring equipment and software controls that can monitor both the production of the home solar system and limit charging to only use electricity produced by the home solar system. Additionally, your home solar and battery systems can be designed so that the home solar system isn’t generating more electricity than your home uses each day. By default, that means the battery will only be charged from excess electricity produced by your home solar system during the day and then used when your home solar system is not producing as much electricity as your home is consuming.
If you have trouble sleeping, read the full IRS ruling here.
Other tax incentives are available for home battery systems in certain states (for example, Maryland and California). For more information on whether any rebates or incentives are available in your particular state, visit www.dsireusa.org, click on your state or search by your zip code, and look for “storage.”
What incentives are available for home batteries?
Like home solar systems, if you obtain a battery via third-party ownership (for example, in conjunction with a solar lease or PPA), you are not eligible for any incentives since you don’t own the battery. Read more about third-party ownership for home solar here.
If you purchase your home battery system (including purchasing via a loan), and it is installed with or within one year of installing a home solar system, the cost of your home battery system is eligible for the Federal Solar Investment Tax Credit or ITC (26% of the total project cost in 2021). But the battery must be charged by the home solar system 100 percent of the time. If your batteries are charged by energy from the grid at all, they are technically not eligible for the ITC.
How do you know whether the batteries are being charged by the grid or your home solar system?
DC-coupled home batteries are connected to your solar panels and charged directly from the DC electricity that your solar panels produce. It’s pretty clear that a DC-coupled home battery is eligible for the ITC.
On the other hand, AC-coupled home batteries are physically connected to a source of AC electricity which could be the grid and/or the AC output of a home solar system’s inverter. Therefore, it’s less clear if the home battery system is being charged by the home solar system or the grid. So how do you know if your AC-coupled home battery is eligible for the ITC?
AC-coupled home batteries come with monitoring equipment and software controls that can monitor both the production of the home solar system and limit charging to only use electricity produced by the home solar system. Additionally, your home solar and battery systems can be designed so that the home solar system isn’t generating more electricity than your home uses each day. By default, that means the battery will only be charged from excess electricity produced by your home solar system during the day and then used when your home solar system is not producing as much electricity as your home is consuming.
If you have trouble sleeping, read the full IRS ruling here.
Other tax incentives are available for home battery systems in certain states (for example, Maryland and California). For more information on whether any rebates or incentives are available in your particular state, visit www.dsireusa.org, click on your state or search by your zip code, and look for “storage.”
Summary
In summary, home batteries can be a great way to power your home with clean, renewable energy in the event of a power outage or to be able to store and utilize more of the solar energy you’re producing with a home solar system.
The cost of home battery systems has come down significantly in recent years and is expected to continue to decline. A home battery can add a significant cost to your home solar project, so it’s critical that you carefully consider the intended use of your home battery system and customize a home battery capacity to match both the intended use and your home solar capacity.
To determine the proper amount of battery capacity for your intended use, you can put together a list of the appliances that you want to be able to power with your home battery, find their electrical ratings, make some assumptions about how long these appliances will run each day and do some simple math to determine your daily kilowatt-hour capacity needs. The figure out how much energy your home solar system will produce to replenish the battery each day. Finally, you’ll want to factor in a healthy discount for your home solar energy production in case it’s cloudy or there’s snow covering your solar panels.
Remember that the cost of a home battery system is eligible for the federal solar investment tax credit (ITC) of 26 percent when installed within one year of a home solar system.
Summary
In summary, home batteries can be a great way to power your home with clean, renewable energy in the event of a power outage or to be able to store and utilize more of the solar energy you’re producing with a home solar system.
The cost of home battery systems has come down significantly in recent years and is expected to continue to decline. A home battery can add a significant cost to your home solar project, so it’s critical that you carefully consider the intended use of your home battery system and customize a home battery capacity to match both the intended use and your home solar capacity.
To determine the proper amount of battery capacity for your intended use, you can put together a list of the appliances that you want to be able to power with your home battery, find their electrical ratings, make some assumptions about how long these appliances will run each day and do some simple math to determine your daily kilowatt-hour capacity needs. The figure out how much energy your home solar system will produce to replenish the battery each day. Finally, you’ll want to factor in a healthy discount for your home solar energy production in case it’s cloudy or there’s snow covering your solar panels.
Remember that the cost of a home battery system is eligible for the federal solar investment tax credit (ITC) of 26 percent when installed within one year of a home solar system.
Interested in pairing a home battery with home solar, but not sure where to start? Learn how Sentinel can help you get the right home solar and battery system for you here or get started with a free Home Solar Assessment.
Interested in pairing a home battery with home solar, but not sure where to start? Learn how Sentinel can help you get the right home solar and battery system for you here or get started with a free Home Solar Assessment.
Have a question on home batteries or anything else? Send us a message and we’ll answer ASAP.
Have a question on home batteries or anything else? Send us a message and we’ll answer ASAP.
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