Economics of charging at 7p and exporting at 15p

[Stinsy]

"miserly 6.31% ROI"

I think there are a fair amount of people who would bite your arm off for an investment plan that returned 6.3% tax free every year - but I get your point it's a lot of capital investment and those returns are not guaranteed (tariffs may go up, as well as go down, battery cycle life, equipment failure etc)

I guess you've not looked at the S&P500 recently? 50% up over the last year!

[dan_b]

Well yes, my stocks and shares ISA has done pretty well this year, but there are years where it's done risibly, or worse! But hey, you pays your money and you make your choice!

"miserly 6.31% ROI"

I think there are a fair amount of people who would bite your arm off for an investment plan that returned 6.3% tax free every year - but I get your point it's a lot of capital investment and those returns are not guaranteed (tariffs may go up, as well as go down, battery cycle life, equipment failure etc)

I guess you've not looked at the S&P500 recently? 50% up over the last year!

[Yuff]

.

[Yuff]

Sure, charging on off-peak then offsetting peak prices is much more compelling, still not amazing though:

Let me know if you think I've added it up wrong...

I’m assuming your figures are 1 cycle a day?
If you take a mixture of the export income and peak rate savings and do 2 cycles a day then the figures become more compelling.
I’m either charging or exporting 24/7 and have the system set up to accommodate that albeit I need to manually do IOG schedules when needed.
But we have 4 EVs and over the past couple of weeks have done several long journey and a 50 mile commute twice a day ( not the norm as SWBMO is visiting her mother in st Mary’s hospital london)which is probably averaging out at 150 miles a day conservatively and the net daily cost has been approximately £3.
The only gas we use is for a gas fire.

I think you've nailed it!

My batteries were not purchased with the intention of charging on cheap electric and discharging to the grid for profit. They were purchased with the intention of self-consuming back when the rate for export was derisory and I couldn't even get a ToU tariff (no smartmeter). Now I primarily use them to avoid paying peak rates.

My small (12kWh) pack isn't big enough to get me from one cheap period to the next however a bit of solar and some generous provision of additional cheapslots on gloomy days gets me through. I only bothered doing the admin required to get paid for electric so that I could max out the saving-sessions. However I found this made summer much less stressful because I could charge the battery to 100% every day rather than 50 or 75%. This was more of an ambivlelence about exporting rather than trying to export as much as I can.

However now we have the possibility to deliberately charge on cheap rate to export that energy back to the grid. And I was wondering if it was worthwhile. Your post has made me think I was too quick to dismiss the miserly 6.31% ROI. Sure, if you were to buy the batteries with the intention of profiting in this way, it isn't worthwhile. But the point I was missing was that this is ADDITIONAL money on top of the self-consumption/ToU shifting! And an extra £20 a month when you've already got an efficient setup IS worthwhile...

I originally invested with the same intentions, however over time and the changing of tariffs my usage has evolved to how I plan my import/export. I have this insane stupidity to always try and maximise my savings for no apparent reason even when it is for minuscule savings ( I even try to maximise the range on our EVs when we had a free charger up the road and I’d drive around with the air con off )
It drives SWMBO crackers
I did think too many cycles might not be worthwhile but I then decided how long will it last you can charge cheaper than you can export and decided make hay whilst the sun is shining

[Stinsy]

Right!

The game is afoot! My bill gets cut today. I've set up my inverter to max out buying-low-selling-high-for-fun-and-profit. I'll report back in a month...

Right, interim results:

Last week I imported 395.9kWh of electric at a cost of £28.06 with the standing charge removed (7.09p/kWh isn't too shabby!) and I exported 92.5kWh earning me £13.87 (15p/kWh). That nets out at £14.19 for the week. Not the zero bill we were talking about on the other thread but it was a week where my best day for solar was 1.8kWh and most days were below 1kWh.

I'm going to try to compare to another similar week, however last week was half term so the kids were all home with all the additional xbox and TV related consumption, not to mention lights on all day, etc.. And we had family staying so there was much more food cooking this week including a full roast for 10 people. So the comparison will not be perfect. However I'm going with WC 14th, not only was this a lower consumption week for general household usage I also benefitted from some decent solar on some days with 9.1kWh on one day. But it is what it is...

On that week I imported 261.9kWh of electric at a cost of £22.21 with the standing charge removed (8.48p/kWh) and I exported 4.6kWh earning me £0.69 (15p/kWh). That nets out at £21.52 for the week. So even with: significant solar assisting my control week and additional consumption impeding my test week, I'm concluding "Operation buy-low-sell-high-for-fun-and-profit" a success!

[Stinsy]

UPDATE:

In the month of November 2024 I imported 1930kWh at a cost of £140.08 (c. 7.3p/kWh) and exported 366kWh making me £54.83 (15p/kWh). This left me a net electric bill of £85.25 for the month.

In November 2023 I imported 1537kWh at a cost of £143.34 (c. 9.3p/kWh) and exported nada.

(All figures from Octopus).

Obviously YoY comparisons are fraught with inconsistencies (anyone remember how cold it was last November? I know this one has been super-mild at times and -6℃ at other times), but I can only analyse the data I have.

Anyway, I'm calling this a win!

[wookey]

I've not actually done any of this yet as I'm still building the system and controls (just about done with system - now on to controls).
But I did some approximate sums before starting to check that it made some sense. (I had done battery sums a few years ago and decided they didn't make any financial sense for low users at that time).
I got a 'cost' of about 1.6p/kWh in battery wear (8000 cycles to 70%, for a batt with average capacity of 13.6kWh (starts at 16kWh, ends at 11.2)) so you need a price differential of at least 1.6p, maybe 2p to be actually getting ahead.

Doing Stinsy's sums for my kit I get:

Capacity 16kWh
Useable capacity 16kWh
(EVE tell us things are rated at 100% cycles and there is no point leaving a bit at the ends on LFP - let's take that at face value even though we dn;t really know if it's true)
Cost to fill £1.12(although they've not had much of a workout yet, it being December).
Received from selling at 15p £2.40
Profit per day £1.28
Profit per year £467.20

Battery cost: £1700
ROI 27.5%

If we decide that a 10% margin on battery capacity is a good idea, then it comes out at 24.7%

So the numbers look a lot better as the price per kWh goes down. And the thing only has to last 4 years to pay for itself in this regime.

I think this illustrates why cheap batteries+solar will be transformative. We are currently hurtling past the price points in PV and batteries that 10-15 years ago people said would make them really economic, which is (partly) why for example Pakistan has imported 13 GW of PV this year (!). Lots of other sunny countries will probably be installing loads too. Once it's cheaper than the grid within 2 or 3 years, anyone with access to capital is going to go for it.

Of course, (as has been pointed out), these sums are very dependent on what price you can sell your generation for (or replace import), and clearly these are going to change quite quickly in response to all this generation. But that's why the combo of cheap PV _and_ cheap batteries is so effective. We definitely live in interesting times.

[Stinsy]

I've not actually done any of this yet as I'm still building the system and controls (just about done with system - now on to controls).
But I did some approximate sums before starting to check that it made some sense. (I had done battery sums a few years ago and decided they didn't make any financial sense for low users at that time).
I got a 'cost' of about 1.6p/kWh in battery wear (8000 cycles to 70%, for a batt with average capacity of 13.6kWh (starts at 16kWh, ends at 11.2)) so you need a price differential of at least 1.6p, maybe 2p to be actually getting ahead.

Doing Stinsy's sums for my kit I get:

Capacity 16kWh
Useable capacity 16kWh
(EVE tell us things are rated at 100% cycles and there is no point leaving a bit at the ends on LFP - let's take that at face value even though we dn;t really know if it's true)
Cost to fill £1.12(although they've not had much of a workout yet, it being December).
Received from selling at 15p £2.40
Profit per day £1.28
Profit per year £467.20

Battery cost: £1700
ROI 27.5%

If we decide that a 10% margin on battery capacity is a good idea, then it comes out at 24.7%

So the numbers look a lot better as the price per kWh goes down. And the thing only has to last 4 years to pay for itself in this regime.

I think this illustrates why cheap batteries+solar will be transformative. We are currently hurtling past the price points in PV and batteries that 10-15 years ago people said would make them really economic, which is (partly) why for example Pakistan has imported 13 GW of PV this year (!). Lots of other sunny countries will probably be installing loads too. Once it's cheaper than the grid within 2 or 3 years, anyone with access to capital is going to go for it.

Of course, (as has been pointed out), these sums are very dependent on what price you can sell your generation for (or replace import), and clearly these are going to change quite quickly in response to all this generation. But that's why the combo of cheap PV _and_ cheap batteries is so effective. We definitely live in interesting times.

Interestingly in many jurisdictions energy companies have been lobbying politicians to pass anti-solar laws because the democratisation of power generation is harmful to their profits!

[Ken]

and no depreciation of the product

[Yuff]

I've not actually done any of this yet as I'm still building the system and controls (just about done with system - now on to controls).
But I did some approximate sums before starting to check that it made some sense. (I had done battery sums a few years ago and decided they didn't make any financial sense for low users at that time).
I got a 'cost' of about 1.6p/kWh in battery wear (8000 cycles to 70%, for a batt with average capacity of 13.6kWh (starts at 16kWh, ends at 11.2)) so you need a price differential of at least 1.6p, maybe 2p to be actually getting ahead.

Doing Stinsy's sums for my kit I get:

Capacity 16kWh
Useable capacity 16kWh
(EVE tell us things are rated at 100% cycles and there is no point leaving a bit at the ends on LFP - let's take that at face value even though we dn;t really know if it's true)
Cost to fill £1.12(although they've not had much of a workout yet, it being December).
Received from selling at 15p £2.40
Profit per day £1.28
Profit per year £467.20

Battery cost: £1700
ROI 27.5%

If we decide that a 10% margin on battery capacity is a good idea, then it comes out at 24.7%

So the numbers look a lot better as the price per kWh goes down. And the thing only has to last 4 years to pay for itself in this regime.

I think this illustrates why cheap batteries+solar will be transformative. We are currently hurtling past the price points in PV and batteries that 10-15 years ago people said would make them really economic, which is (partly) why for example Pakistan has imported 13 GW of PV this year (!). Lots of other sunny countries will probably be installing loads too. Once it's cheaper than the grid within 2 or 3 years, anyone with access to capital is going to go for it.

Of course, (as has been pointed out), these sums are very dependent on what price you can sell your generation for (or replace import), and clearly these are going to change quite quickly in response to all this generation. But that's why the combo of cheap PV _and_ cheap batteries is so effective. We definitely live in interesting times.

Wookey if you do 2 cycles a day then it drops to 2 years, albeit twice the usage. However my view is how long can this last so make hay while the sun shines ……literally