Sizing, Worked Examples and Quote Checklists
Home battery payback worked example: net cost, daily kWh shifted and years to break even
A step-by-step battery payback calculation for an Australian home with illustrative numbers — net price after STCs, daily saving, losses, tariff changes and sensitivity tests.
To work out a home battery's payback, take the net price after incentives and divide it by the yearly bill saving. The saving is roughly: kWh shifted per day × (import rate avoided − feed-in tariff given up) × round-trip efficiency × 365, plus any VPP income you are confident of. In our illustrative example below, a 13.5 kWh battery with a $14,000 quote and $3,276 of federal discount has a net cost of $10,724 and saves about $887 a year, giving a simple payback of around 12 years. Change the inputs — a lower quote, a larger tariff gap, a state incentive — and payback can move by several years either way. Compare the result with the battery's warranty, which is often 10 years.
All prices, tariffs and savings here are illustrative assumptions. Use the payback calculator with your own quote and bill. For sizing first, read the battery sizing guide.
The example household
| Input | Illustrative value | Where you get yours |
|---|---|---|
| Solar system | 6.6 kW, existing | Your inverter details |
| Battery | 13.5 kWh usable, AC-coupled | The quote |
| Installed price | $14,000 | The quote (gross) |
| Installation date | November 2026 | The quote |
| Evening use | 12 kWh summer, 15 kWh winter | Interval data |
| Spare solar | 18 kWh summer, 6 kWh winter | Interval data or inverter app |
| Evening import rate | 35 c/kWh | Your plan's peak rate |
| Feed-in tariff | 5 c/kWh | Your plan |
| Round-trip efficiency | 90% | Battery spec sheet |
Step 1: net cost
- Federal STCs: 13.5 × 6.8 = 91.8 → 91 certificates
- Value at an illustrative $36: 91 × $36 = $3,276
- Net cost: $14,000 − $3,276 = $10,724
If the household were a Synergy customer in WA eligible for up to $1,300 under the WA Residential Battery Scheme (with VPP enrolment), the net cost would fall to about $9,424. See state incentives.
Step 2: kWh shifted per day
The battery shifts the smaller of its usable capacity, the spare solar and the evening use:
| Season | Usable | Spare solar | Evening use | kWh shifted |
|---|---|---|---|---|
| Summer (about half the year) | 13.5 | 18 | 12 | 12 |
| Winter (about half the year) | 13.5 | 6 | 15 | 6 |
| Average | 9 kWh/day |
Step 3: value of each kWh shifted
- Gap: 35 c − 5 c = 30 c per kWh
- After 10% losses: 30 c × 0.9 = 27 c per kWh
Step 4: yearly saving and payback
- Daily: 9 × $0.27 = $2.43
- Yearly: $2.43 × 365 = $887
- Simple payback: $10,724 ÷ $887 = 12.1 years
Step 5: sensitivity tests
Payback is very sensitive to a few inputs. Changing one at a time:
| Change | Yearly saving | Net cost | Payback |
|---|---|---|---|
| Base case | $887 | $10,724 | 12.1 years |
| Quote $11,000 instead of $14,000 | $887 | $7,724 | 8.7 years |
| Evening rate 45 c instead of 35 c | $1,183 | $10,724 | 9.1 years |
| Feed-in tariff 10 c instead of 5 c | $739 | $10,724 | 14.5 years |
| Free-midday plan fills battery in winter (shift 12 kWh all year) | $1,183 | $10,724 | 9.1 years |
| Installed in January 2027 (factor 5.7, 76 STCs) | $887 | $11,264 | 12.7 years |
| Add VPP income of $100 a year | $987 | $10,724 | 10.9 years |
The calculations: 45 c gives (0.45 − 0.05) × 0.9 × 9 × 365 = $1,183; a 10 c feed-in gives (0.35 − 0.10) × 0.9 × 9 × 365 = $739; shifting 12 kWh all year gives 12 × $0.27 × 365 = $1,183. Note that a free-midday plan may come with different peak rates and supply charges; include those before you rely on it.
The two biggest levers are usually the quote price and the gap between import and feed-in rates. A cheaper quote with the same hardware has the same effect on payback as a large tariff change.
Step 6: what simple payback leaves out
| Factor | Effect | How to allow for it |
|---|---|---|
| Battery capacity fade | Saving falls slowly over time | Enter a small negative yearly change in the calculator |
| Tariff increases | Saving rises | Enter a positive yearly change |
| Finance interest | Raises the real cost | Add interest to the cost, or see finance options |
| Inverter replacement | A future cost, especially for older solar inverters | Add a contingency |
| Blackout value | Not a bill saving, but real for some homes | Weigh separately |
| Opportunity cost | Money spent could earn interest elsewhere | Compare with your savings rate |
The payback calculator lets you enter a yearly percentage change in the saving and a horizon. With the base case, a 10-year horizon and no change, total savings are about $8,870 — less than the $10,724 net cost. With a 3% yearly increase in savings over 15 years, the total is about $16,500, comfortably above the net cost. The answer depends on how long the battery lasts and how tariffs move.
Step 7: compare with the warranty
If simple payback is longer than the warranty term, you are relying on the battery lasting beyond its guarantee. Check the warranty's years, throughput limit and retained-capacity guarantee; see warranties and consumer guarantees.
FAQ
Is a 12-year payback worth it?
That depends on your priorities. Some households value blackout backup or energy independence; others only proceed if payback is well inside the warranty. Run several scenarios and decide with realistic inputs.
Should I use the installer's savings estimate?
The CER requires retailers to give written payback or savings estimates before installation. Ask what rates, kWh shifted and losses they assumed, and redo the calculation with your own numbers.
Does a bigger battery pay back faster?
Only if you can use the extra capacity. In this example a 20 kWh battery would shift the same 9 kWh a day on average, so payback would get longer.
Sources
- Clean Energy Regulator — STC factor and calculator
- Energy Made Easy — current plans and rates in your area
- Victorian Energy Compare — Victorian plans
- WA Government — WA Residential Battery Scheme
