What The Current Energy Tariffs Mean for Battery Storage Systems

As Kovilan Chinnathambi, Freedom Won Sales Engineer, puts it:

“Understanding when and how energy is billed is key to unlocking the true ROI of a storage solution. You’re not just storing energy – you’re shifting value.”

Here are three key insights on how energy tariffs influence storage strategies:

1. Storage + Tariff = Smarter Scheduling: Time-of-use tariffs reward strategic discharge. Batteries can be charged during off-peak hours and discharged when energy costs are at their highest. This isn’t just energy arbitrage – it’s revenue engineering.

2. Tariffs Shape System Design: Understanding a client’s tariff structure helps determine optimal storage capacity and inverter sizing. A one-size-fits-all approach wastes potential.

Kovilan further says, 

“Storage solutions should be designed around tariff dynamics, not just load profiles.”

3. Max Demand Charges:  Battery energy storage can be used to reduce the Max demand that an installation utilises. Savings can be achieved by eliminating max demand charges when the installation uses power in excess of their allocated connection or by utilising the BESS to reduce the maximum consumption and moving to a lower KVA connection.

4. Incentivising Independence: As tariffs rise and fluctuate, the ability to manage consumption and costs in real-time becomes a competitive advantage. The right BESS can enable partial or full grid independence – without over-capitalising.