Updated 4 weeks ago

How is solar energy stored?

Written by Catherine Lane

Image source: Solar Power World

Solar panels are one of the best tools we have to combat climate change and to gain some freedom from utility companies. But solar panels do have one fatal flaw: they don’t produce electricity when the sun isn’t shining. 

That’s where solar energy storage comes in. Pairing a solar panel system with energy storage makes it possible to use solar energy, even when there is no sun, by saving the electricity for later use. 

Solar storage is not only great for the environment, it also unlocks a number of benefits for homeowners, like access to reliable backup power and in some cases, additional electric bills savings. 

Calculate how much a solar + battery installation would cost for your home

Key takeaways

  • Mechanical storage, thermal storage, and battery storage are all ways that solar energy can be saved for future use.

  • Batteries are the most common solar energy storage for residential photovoltaic (PV) solar systems.

  • Lithium-ion batteries charge and discharge from a chemical reaction that moves electrons from one part of the battery to the other.

  • Solar energy storage provides reliable backup power, energy independence, can reduce electric bills, and are environmentally friendly.

  • Solar batteries will cost between $9,000 and $12,000 to install and qualify for a 30% tax credit from the federal government.

How to store your solar energy

Most homeowners choose to store their solar energy by using a solar battery. Technically, you can store solar energy through mechanical or thermal energy storage, like pumped hydro systems or molten salt energy storage technologies, but these storage options require a lot of space, materials, and moving parts. Overall, not the most practical way to store energy for a home. 

Solar batteries, on the other hand, are a great way to store residential solar energy. The most common type of battery used for solar energy storage are lithium ion batteries. Lithium ion batteries last longer, require less maintenance, and take up less space than other solar energy storage solutions on the market, like lead-acid batteries

Lithium ion batteries are able to store solar energy through a series of chemical reactions, where lithium ions are moved through an electrolyte solution within the battery. So, when solar panels send electricity to the battery storage system a chemical reaction occurs that moves lithium ions and releases electrons in an electrolyte solution within the battery, which stores the energy.

When you need to use electricity from the battery, the electrons flow backward and the electricity is discharged from the battery. This process can be repeated over and over again, making the battery rechargeable. 

How much does solar energy storage cost?

Adding solar energy storage typically costs between $12,000 and $20,000. For example, a Powerwall battery costs about $15,500 fully installed by Tesla, whereas a Panasonic EverVolt battery would be closer to $18,000.

Luckily, there are some states that offer rebates and incentives specifically for solar energy storage, like California’s SGIP Program, that help soften the blow of upfront costs. Not only that, solar batteries are eligible for the 30% federal solar tax credit, as well.

Learn more: State-by-State Solar Incentive Guide 

The actual price you’ll pay for solar energy storage depends on the type of battery that you choose, the manufacturer, and how many batteries you install.

Not sure where to start when it comes to shopping for solar energy storage? Check out our best solar battery buyer's guide.

The benefits of solar energy storage

Solar energy storage systems are becoming more popular every year and it’s no surprise why - here are just a few of the benefits of installing solar-plus-storage: 

Backup power

Despite what many people believe, solar panels will not power your home during a power outage. In order to keep your lights on when the grid goes down, you need to pair your solar system with a solar battery. This is why energy storage is most popular in places like California, where widespread power blackouts are commonplace. 

As an added bonus, solar batteries are a much quieter backup power option than gas-guzzling generators. Plus, you don’t have to worry about refueling a battery, you just let your solar panels do their thing and the energy is ready for you to use! 

Energy independence

Having solar energy storage means you’re less reliant on the utility grid. We already know that means that you’ll be protected when the grid power goes out, but it also means that you’ll be less beholden to the utility all around. 

For one thing, solar energy storage protects you from the electric rate increases that are almost guaranteed to happen every year. A battery lets you pull electricity from it instead of taking power from the grid and paying expensive rates. 

Also, you know exactly where your power is coming from. With a utility, the energy can be generated from foreign gas and oil. You can rest assured that your home is powered with solar energy made right on your roof! 

Electric bill savings

In many places, a solar battery won’t give you extra utility bill savings because of a utility rate structure called net metering. With full retail net metering, your utility will pay you the full retail rate of electricity for any excess solar energy that your home doesn’t use. Essentially, you use the utility as your “financial battery”. 

However, not all utilities offer full retail net metering, and instead they purchase excess solar electricity at a lower price. This is where solar energy storage can provide extra utility bill savings. Instead of sending your excess electricity to the grid and getting paid a low rate, you store it for later and get the full retail value out of it. 

Solar storage is also helpful if your utility uses Time-of-Use rates to charge higher electric prices during peak demand hours. You can use the electricity stored in your battery during these peak hours and avoid paying the expensive rates set by your utility. 

Find out if installing battery storage is worth it in your area

Reducing your carbon footprint

Many utility companies in the U.S. still create most of their power using dirty fossil fuels. This means that for every kilowatt-hour of electricity you use from your utility, you’re probably contributing to the burning of fossil fuels. 

With solar energy storage systems, however, you use all of the electricity your solar energy system produces, maximizing the amount of renewable energy your home runs on. Solar panels don't generate electricity at night, so storing it let you use more clean electricity to power your home. Using a clean energy source like solar cuts back on carbon emissions and makes for a happier and healthier planet. 

Is solar energy storage right for your home?

If you live somewhere that experiences frequent electric grid power outages, or if your utility uses Time-of-Use rates, then solar battery storage will be a worthwhile investment for you. Otherwise, solar batteries are still pretty expensive, so they won’t pan out financially for most homeowners. 

While there are plenty of solar battery benefits, you need to consider if those benefits outweigh the costs. What we mean is, solar energy storage isn’t something you need to install, it’s more of a luxury.

While solar energy storage might not provide you with additional financial savings, solar panels almost certainly will. Solar panels are cheaper than ever and will start saving you on your electric bills from Day 1. You can see if solar panels are right for your specific home using our solar savings cost and savings calculator.  

Written by Catherine Lane Solar Industry Expert

Catherine is the Written Content Manager at SolarReviews, where she has been at the forefront of researching and reporting on the solar industry for five years. She leads a dynamic team in producing informative and engaging content on residential solar to help homeowners make informed decisions about investing in solar panels. Catherine’s expertise has garnered attention from leading industry publications, with her work being featured in Sola...

Learn more about Catherine Lane