Home Battery Time-of-Use Arbitrage Calculator
Introduction
This calculator estimates the narrow value of charging a home battery when electricity is cheap and discharging it when time-of-use rates are high. It is useful for screening whether tariff arbitrage alone is meaningful before you add other value streams such as backup power, solar self-consumption, or utility incentive programs.
The model is intentionally simple. It uses usable battery capacity, round-trip efficiency, the peak-to-off-peak rate spread, average daily cycles, and installed cost to estimate savings per cycle, annual savings, and simple payback.
How to use
Enter the amount of battery capacity that is realistically available for daily shifting, not just the nameplate size. Then enter round-trip efficiency, the peak rate you want to avoid, the lower charging rate, average daily cycles, and the system cost you want to recover.
Run at least two cases. A conservative case should reduce usable capacity or cycles to reflect backup reserve settings and imperfect real-world usage. A second case can use the best tariff spread you reasonably expect.
Formula
The calculator treats arbitrage savings as delivered battery energy multiplied by the rate spread.
Simple payback is system cost divided by annual savings. Wider rate spreads, higher usable capacity, and more frequent cycling all improve the estimate.
Example
With the default values, a 13.5 kWh battery at 90% efficiency shifts about 12.15 kWh of delivered energy per cycle. If the peak rate is $0.40 per kWh and the off-peak rate is $0.15 per kWh, the spread is $0.25 per kWh and the modeled savings are roughly $3.04 per cycle.
At one cycle per day, that works out to about $1,100 per year. Against an $8,000 installed cost, the simple payback is a little over seven years.
Limitations
This calculator does not model export compensation, demand charges, battery degradation, financing, seasonal tariff changes, or the possibility that your home may not have enough peak-period load to use a full cycle every day. It also assumes the battery can charge and discharge when the tariff windows make that worthwhile.
Use the result as a first-pass check. If arbitrage still looks attractive after conservative assumptions, then it makes sense to layer in incentives, backup value, and detailed tariff rules.
Practical notes before you rely on the estimate
If you are using this calculator to compare installer proposals, try running at least three cases: a conservative case, a realistic case, and an optimistic case. In the conservative case, lower the daily cycles or usable capacity to reflect reserve settings and imperfect real-world operation. In the optimistic case, use the best tariff spread you expect to see consistently. The realistic case should sit somewhere in between. This range-based approach is usually more informative than a single point estimate.
Also check whether your utility’s published rates include all relevant energy charges. Some tariffs have seasonal schedules, weekday and weekend differences, or separate delivery charges that change the effective spread. If your battery is paired with solar, think carefully about what the off-peak price represents. In some situations it is the retail off-peak import rate; in others it may be closer to the opportunity cost of exporting solar energy instead of storing it.
Finally, remember that simple payback is intentionally simple. It does not discount future savings, include financing costs, or account for replacement and maintenance. That makes it easy to understand, but it also means it should be treated as a rough benchmark. For a purchase decision, many homeowners eventually move from a quick calculator like this to a more detailed spreadsheet or installer proposal. Even then, this tool remains useful because it gives you a transparent baseline and helps you spot assumptions that are too aggressive.
Enter your assumptions
Adjust the inputs and compute results to copy a summary.