How Even Small Batteries Make a Big Difference for Solar Homes

If you have solar on your home, you may be considering the addition of a residential energy storage system (or more simply, batteries). But how much battery capacity do you need? A few hours worth, a few days, or something in between. Certainly, more capacity will last longer, but the cost adds up quickly. If money is no object for you, go nuts and include a Megapack if you'd like. For the rest of us, finding the right balance of cost and effectiveness is important. 

While the idea of storing multiple days' worth of energy might seem appealing, a few hours of storage delivers surprising value at a fraction of the cost. Systems like the Tesla Powerwall, with a capacity of 13.5 kWh, demonstrate how compact storage solutions can optimize energy use, reduce costs, and enhance reliability. The key takeaway? Bigger is not always better when it comes to energy storage.

Conventional Wisdom

An industry rule-of-thumb is that for each 1 kW of solar PV you have, you should have 5 kWh of battery capacity. This guideline provides a useful starting point. It seeks to balance capturing excess daytime solar production with meeting evening demands or managing short outages. It often aligns well with the household's daily energy use. However, it is not a one-size-fits-all solution. Factors such as local electricity rates, net metering rules, solar output, AC/heat pumps, EV charging, and individual consumption patterns may necessitate adjustments. It's essential to choose a size that's tailored to your home's specific needs.

Time-Shifting Energy for Cost Savings

One of the primary benefits of limited storage is the ability to time-shift solar energy. Solar panels generate the most electricity during midday when sunlight is abundant, but household energy demand often peaks in the late afternoon or early evening. Utility companies frequently implement time-of-use (TOU) or time-of-day (TOD) pricing, where electricity rates during peak hours can be two to three times higher than off-peak periods. With just 4 to 8 hours of storage, homeowners can store excess solar energy produced during the day and use it to shave off these costly peak periods. For a typical household consuming 30 kWh daily, a battery storing just 10 kWh can generally cover evening demand, slashing expensive peak rates. This approach maximizes savings without the need for an oversized, costly battery system.

Enhanced Reliability During Outages

Short-term energy storage shines during power outages, which are often brief. According to US utility data, approximately 70 to 80% of outages last less than two hours, and many are resolved within minutes. A battery with a few hours of capacity ensures critical appliances like lights, refrigerators, and communications remain operational. This uninterrupted power prevents inconvenience, such as stumbling in the dark to find flashlights or candles. It also provides a buffer to safely power down sensitive electronics, protecting them from potential damage when grid power returns. For households in areas prone to short outages, this level of backup is often sufficient, making larger systems unnecessary.

Safety and Convenience in Emergencies

Even a brief loss of power can disrupt daily life. A few hours of battery storage keeps the lights on, reducing the risk of accidents like tripping over furniture or banging a shin while navigating a dark home. In the event of an evacuation, such as a wildfire, having power ensures you can pack up and load the car quickly, even if the grid has failed. This reliability transforms a potentially chaotic situation into a manageable one, highlighting the practical benefits of modest storage capacity.

Cost-Effectiveness of Compact Systems

While multi-day storage might seem ideal, the costs escalate quickly. A single battery unit providing 4 to 8 hours of storage for critical loads typically costs between $7,000 and $15,000 installed. Scaling up to multiple days of storage could double or triple this expense, with diminishing returns for most households. Short outages and peak pricing periods are the primary concerns for most, and a smaller battery addresses these effectively. Investing in excessive capacity often yields minimal additional benefits, reinforcing that bigger is not always better; sometimes it just costs more.

Conclusion

A few hours of energy storage paired with solar offers a compelling balance of cost, convenience, and reliability. By enabling time-shifting, ensuring power during brief outages, and enhancing safety, compact systems deliver outsized value. Homeowners can achieve significant savings and peace of mind without the expense of oversized batteries, proving that modest, strategic storage is often the smartest choice. 10 - 15 kWh adds a lot of value, without a huge price tag. However, if you're looking to time-shift or need longer blackout protection, you may need 30kWh+.

Soon after our Powerwalls were installed, our power went out in the dead of winter.

If you'd like a Powerwall or two, you can use my referral code: ts.la/patrick7819