Is the cost of a solar battery worth the investment?

As hardware costs see tailwinds and solar power systems become increasingly capable, solar battery storage adoption rates are rising in the U.S.

While approximately 12% of photovoltaic (PV) systems installed on homes and businesses included battery storage in 2023, the Solar Energy Industries Association estimates that this rate will rise to 28% by 2028.   

In this article, we weigh solar battery costs and benefits to help you decide if storage will be worth it for your home’s renewable energy system.

How much does a solar battery cost? 

Solar battery costs vary by brand and capacity, and there are several other expenses associated with home energy storage. Here is a cost breakdown of a typical home solar battery installation: 

• Battery: Most home solar batteries cost around $5,000 to $7,000 each, and installations can include multiple units for expanded storage capacity.  
• Hardware: Batteries must be mounted and integrated with your home’s solar energy system, with some wiring and hardware costs incurred. In older homes, adding solar battery storage could necessitate an electric panel upgrade, which though not always required, can cost between $1,000 and $2,500 on average. 
• Permitting: Solar battery permitting costs vary by jurisdiction and project, but they typically amount to a few hundred dollars in total.   
• Labor and overhead: With professional help, solar battery installations can also include $2,000 to $3,500 in labor and overhead costs. 

The cost of solar energy storage has decreased dramatically since 2010, and battery systems are now cheaper and more widely accessible than ever. In 2024, experts forecast that solar storage prices will continue to decline through 2025.  

Image source: PV Magazine

Factors that affect your solar battery cost 

While all solar storage installations incur the same types of expenses like hardware and overhead, the total cost of your battery system will depend on several factors unique to your project. 

1. Solar energy storage capacity and quantity

The optimal battery capacity for your installation will depend on the size of your solar panel system, your home’s electricity demand, and your overall energy goals. For example, if you would like complete solar energy self-sufficiency, you may need more batteries compared to someone who only wants backup power for occasional outages.

2. New installations vs existing solar energy systems

The total costs of battery storage will depend on whether it’s part of a new energy system or integrated into an existing solar panel installation. In general, upgrading a solar system to include battery storage later is more expensive than when installing everything at once. 

If you don’t want to invest in storage when installing solar panels, you can save money on future upgrades by ensuring your inverter system is suited for battery integration. In the same sense, it’s also possible to install a stand-alone home battery without solar panels.

3. Financial incentives and rebates

There are many financial solar incentives and rebates available to make solar battery installations more cost-effective. Most importantly, home solar and standalone energy storage systems at least 3 kWh in capacity may qualify buyers for a federal income tax credit (ITC) worth 30% of total project costs.

Beyond the federal ITC, there are also many incentives, rebates, and programs to reduce solar battery installation costs sponsored by local governments and utilities. For example, if you live in Minnesota, you may be eligible for a battery storage rebate worth up to $5,000, $7,000, or $15,000, depending on the size of your system, your electric utility, and your income qualifications.

When considering solar battery storage, consulting a professional installer is recommended to explore the available programs in your area, learn whether you’ll qualify, and determine how to get started.

Energy bill savings and calculating solar battery ROI

While installing solar panels can help you reduce your spending on utility electricity, battery storage can take these savings even further. Storing electricity produced from sunlight throughout the day, solar batteries can provide an alternative to grid-supplied power after the sun goes down, when utility rates are too expensive, or during a local outage.

Solar savings with increased self-consumption 

By tapping into storage reserves in the morning, evening, or on cloudy days, solar battery backup systems can minimize the amount of electricity your home draws from the energy grid. To offset all possible utility energy costs with maximum use of your solar power, Enphase IQ Batteries feature a Self-Consumption profile for automated savings. 

Electric bill saving and energy-sharing programs

While solar energy storage will decrease your monthly utility electricity consumption, a battery integrated with the energy grid can also lead to several other financial rewards through local programs. For example, exporting stored solar power to the grid can help you earn utility bill credits, at a rate determined by local net energy metering policies.

Even further, there are many energy-sharing programs specifically for solar battery owners emerging around the U.S. that compensate homeowners for exporting electricity to the grid during peak demand hours. Known as grid services, these solar energy storage incentives can dramatically accelerate your battery investment payback period, with some programs sponsoring rewards of over $1,000 annually for active participation.

The non-financial benefits of a solar battery

Before we settle on whether solar battery cost is worth the investment, it’s important to highlight the non-financial benefits of a solar battery backup as well. With greater energy independence, a solar battery installation offers secure home electricity access, delivering invaluable peace of mind to run essentials sustainably during local power outages. 

Enabling maximum consumption of renewable energy on-site, solar batteries can also significantly reduce carbon footprints for homes that rely on fossil fuels with grid-supplied electricity or gas-powered backup generators. With battery storage, you can gain the most control over how your solar power is used, including the cheapest and greenest way to charge your EV.

Verdict: Are solar batteries worth it?

Through utility bill reductions, financial incentives, and peace of mind, solar energy storage is worth it for many homeowners today. With a solar battery backup and energy independence, you can gain greater control over your home’s ongoing electricity costs and carbon emissions, while staying prepared for potential grid outages. 

Cost of a solar battery FAQs

What is the lifespan of a solar battery? 

The lifespan of a solar battery backup depends on its chemistry, quality, and usage habits. Solar battery warranties are typically the best indicator of potential product lifespan, rated in years or lifecycles. 

Is a solar battery a good investment? 

Battery storage can be a good financial investment to lower long-term electricity costs at home with greater control over your solar energy use and savings. Storage also provides increased energy security and further carbon emission reduction potential.  

Are solar batteries safe? 

Yes, when manufactured and handled correctly, solar batteries are safe for indoor and outdoor use. Enphase IQ Batteries utilize lithium iron phosphate chemistry, which means they are safer and last longer than other battery chemistry alternatives.