Time-of-use basics
TOU plans charge more during peak windows (often 4-9 pm) and less overnight. Batteries charge cheap and discharge dear.
Demand charges
Commercial bills add $/kW on the monthly peak. Shaving peak kW with a battery cuts that line directly.
Check your bill first
Compare your average bill and rate against benchmarks; flat-rate, low-use homes gain least from arbitrage.
Formulas used
Arbitrage savings
shifted kWh x (peak - off-peak) x efficiency
Worked examples
13.5 kWh x 350 days, 23c spread
4725 x 0.23 x 0.9 = $978/year.
Common questions
What is battery arbitrage?
Charging off-peak and discharging at peak to capture the rate spread.
Do demand charges apply to homes?
Rarely; they are mainly commercial. Home batteries target TOU spreads and backup instead.
Sources
- Electricity Data U.S. Energy Information Administration
- Energy Saver: Saving Electricity U.S. Department of Energy