When installing a solar energy system for your home, including a roofing system, it is always a good idea to acquire a battery backup solution. Tesla Powerwall is a solid, if somewhat expensive, example. During the day, when the panels are operating, they will also charge the battery, which can be used outside of business hours, such as at night, or sometimes during a power outage. The key word is “sometimes” because the system may also need specialized hardware to support its use in the event of a power outage. Either way, battery backup is invaluable for extending the usage life of your new solar and renewable energy source. But a common misconception is that these backup solutions also save you money. That’s not really true.
The main purpose of a battery backup is to provide at least some power during power outages or off-peak hours. However, batteries are not designed to help you lower the costs of your electricity bills and save you money, at least not commercially. Sure, they can reduce your reliance on grid-based electricity, but the upfront costs usually exceed anything you might save for a while. Additionally, federal tax credits for solar equipment, including battery backups, have mostly expired and are only available to homeowners under certain conditions through 2028. The real way to save money is through what’s called net metering, which involves selling excess energy back to the grid. This highlights one of the few things you need to know before installing battery and solar panel solutions. Solar technology, combined with a battery backup like the Tesla Powerwall, is a long-term investment. It will almost always take some time before you can recoup your costs.
How much does a Tesla Powerwall cost in total?
According to Tesla estimates, a single Powerwall 3 costs just under $12,000. However, this price does not include local taxes, delivery charges, installation fees or any applicable “other fees and charges”. Adding expansion units to increase power capacity can increase base costs to more than $20,000, or nearly $29,000 with two expansion units.
Energy Sage estimates the after-installation cost to be closer to $15,647 for a single 13.5 kilowatt-hour storage unit, which matches the size of Tesla’s Powerwall 3. This size also offers between eight and 14 hours of backup power for essentials. Light loads will drain the battery more slowly, while heavy loads from large appliances like a refrigerator will drain it more quickly. If you were to make a rough estimate of $1,100 in savings per year by going off-grid (which some outlets say is at least achievable), it would take 13 years to see a return on investment for just the Powerwall installed.
Costs also vary depending on the state and what is included in your comprehensive package. Batteries are more expensive in states like North Dakota, South Dakota and Nebraska, where the same system can cost $36,000 or more. Some states also offer local tax credits and incentives that are not available everywhere. If the battery is installed separately from your solar panels or solar generator, you will need to factor in these costs as well. But here’s something else to keep in mind: Batteries tend to last between 10 and 15 years, while homeowners often take out loans for 20 or 25 years. You could end up paying interest and paying something that won’t last the life of your loan.
So, what are battery backups for?
The overriding idea here is not to avoid battery backups altogether. In fact, they are an incredible investment in areas where power outages are possible, especially multi-day outages like those caused by severe weather and other natural events. You don’t want to think of it as a big savings, but rather peace of mind when you really need the extra power.
It’s also important to note here that while the Tesla Powerwall 3 is a capable and relatively mid-priced option, it’s not the only one on the market. There are many alternatives, some cheaper and some more expensive. Companies like Sol-Ark and Rubix offer more affordable business models. Companies like LG and Generac also offer options comparable to Tesla’s backup system. There’s no denying that these backup solutions are a great way to make your home’s solar energy system more efficient, but for most people, this will come down to a realistic return on investment. Additionally, you generally can’t run a home 100% on solar, due to many obstacles such as size requirements and net metering limits.
If you don’t have power outages often or live in an area without major storms or grid-related events, it may not be worth investing in a battery backup, at least not at the average cost of a Tesla Powerwall. This is especially true if you’re considering signing up for a multi-decade loan that could potentially last longer than the battery’s expected lifespan. Additionally, some states have capped net metering or are removing solar incentives. In some of these cases, there is no real benefit to generating excess power, although the units remain useful even as backup power sources.
