Solar + Battery Combined ROI Calculator

Does adding a battery to solar actually improve the ROI?

The honest answer in 2026: sometimes. The combined ROI of solar and battery depends on one number more than any other - the spread between your grid import rate and your feed-in tariff. In most Australian states, that spread has widened dramatically over the past three years, which is making the battery case increasingly compelling. But it still depends heavily on your specific tariff, solar system size, and how much electricity you consume.

Australia's residential feed-in tariff has effectively collapsed. What was 20–44 cents per kilowatt-hour in the 2010s is now 2–8 cents in most states. Meanwhile, grid import rates have climbed steadily - the average residential rate passed 30 cents in most states by 2025. That gap between what you pay to import (30+ cents) and what you earn exporting (2–8 cents) is the battery's economic argument. Every kilowatt-hour you keep in the house rather than export represents a 22–28 cent saving per kilowatt-hour. That's not trivial.

Why the battery ROI depends on your solar size

A battery only earns money by storing solar that would otherwise be exported at the low feed-in rate, then using that stored energy at night instead of drawing from the grid. If your solar system is undersized relative to your household consumption, there may not be much surplus to store - the battery cycles less frequently and the return is poor.

The sweet spot for battery returns is a household that generates notably more solar than it consumes during the day. For a typical 6.6kW system in NSW generating around 9,900kWh per year, and a household consuming 20kWh/day (7,300kWh/year), roughly 40–50% of generation is surplus during daytime hours. A 10kWh battery can capture 2,800–3,000kWh of that annual surplus and redirect it to evening use. At a 25-cent arbitrage margin, that's $700–$750 of additional annual saving on top of the solar-only return.

Against a battery cost of $10,000 installed, that produces a battery-specific payback of around 13–14 years - longer than the solar system itself (typically 5–8 years). The combined system payback is somewhere in between, but the battery is clearly the lower-return component.

When the battery numbers work - and when they don't

The battery ROI improves significantly when:

• You have a time-of-use tariff: On a ToU tariff, peak rates during 3–9pm can reach 50–60 cents/kWh in some states. A battery that discharges during this window earns the full spread between cheap off-peak charging (15–22 cents) and expensive peak import (50–60 cents). This can nearly double the effective arbitrage value versus a flat-rate tariff.
• You're in SA or VIC with a large state rebate: South Australia's Home Battery Scheme has offered subsidies of $2,000–$5,000 for qualifying households. Victoria's Solar Homes battery rebate has gone up to $8,800. These rebates can reduce the effective battery cost by 30–80%, cutting payback from 13 years to 4–7 years.
• You're in a VPP: Virtual Power Plant programs pay you an additional income for dispatching your battery during grid emergencies. AGL, Energy Locals, and Tesla's Powerwall VPP have historically returned $300–$600/year for active participants. This is not included in this calculator and represents upside to the numbers shown.
• Your solar system is 10kW or larger: A larger system generates proportionally more midday surplus. A 13.2kW system on a 20kWh/day household generates enough surplus to fully cycle a 10kWh battery nearly every day, maximising the annual kWh arbitraged and shortening payback considerably.

The battery case weakens when:

• Your FiT is still above 10 cents: Some older feed-in tariff contracts in Queensland and SA still pay 10–16 cents. At these rates, the arbitrage value of storing rather than exporting is much smaller. Run the numbers carefully if you're on a legacy high-FiT contract before switching to a battery-optimised tariff.
• Your household consumption is low: A small household consuming 10–12kWh/day doesn't have enough evening demand to usefully discharge a 10kWh battery. The battery cycles partially, reducing annual kWh arbitraged and extending payback.
• You already have a large, well-oriented solar system: Counter-intuitively, some households generate so much surplus that even a large battery can't consume it all. If you're already exporting 60–70% of generation with a 13kW+ system, the incremental value of an additional battery cycle declines.

Solar-only vs solar + battery: the self-consumption rate is the key number

Self-consumption rate - the proportion of your solar generation that you actually use yourself rather than export - is the single metric that determines whether your solar investment is working efficiently. A system with 30% self-consumption is exporting 70% of its generation at 5 cents while paying 32 cents for evening imports. A system with 75% self-consumption is capturing the majority of its generation at full avoided-import value.

For context, a typical Australian home without a battery achieves 30–40% self-consumption from a 6–7kW system. Adding a well-sized battery typically lifts this to 65–80%. Adding an EV charged from solar can push it above 80–85%. Each step up the self-consumption ladder meaningfully improves the effective return on the solar investment.

This is why modelling solar and battery together - rather than in isolation - gives a more accurate picture. The battery's role is to salvage solar value that would otherwise be wasted at feed-in rates. The solar system's value to the battery is in providing the surplus to charge it. They are interdependent, and assessing them separately understates the combined system's return.

The right sequence: solar first, battery when the math works

For most households, the financially optimal approach in 2026 is to install solar first and add a battery when the economics justify it - either because your FiT has dropped further, electricity prices have risen, a state rebate is available, or a VPP program makes the battery financially attractive.

Solar panels return 5–8 year payback almost universally in Australia in 2026. A well-chosen battery returns 8–15 years depending on the variables above. Buying both simultaneously is not necessarily wrong - installer savings and disruption reduction have value - but the decision to add a battery should be driven by the battery's own ROI, not by the solar system's strong returns bleeding across the combined system calculation.

Use this calculator to model your specific system size, tariff, and state, and compare the solar-only column to the combined column. If the battery adds less than $500/year in incremental saving on your numbers, and there's no state rebate available, it may be worth waiting a year or two for further battery cost reductions before pulling the trigger.

2026 battery prices and what to expect

Residential battery prices in Australia have fallen approximately 30–40% since 2020 on a per-kWh basis. A 10kWh LFP battery fully installed now costs $8,000–$12,000, compared to $14,000–$18,000 in 2020. The trajectory continues downward, with most analysts projecting a further 20–30% decline by 2028 as Chinese LFP cell production capacity expands and Australian installation volumes grow.

The implication: if your numbers show a 13-year payback today and you don't have an immediate state rebate available, waiting 2–3 years for further price reductions is financially rational. A 20% battery cost reduction cuts payback from 13 years to approximately 10 years without any other change. For households already planning a solar installation, asking the installer about battery-ready inverter selection now - to avoid a second switchboard visit when adding a battery later - is the pragmatic middle path.