A home battery stores cheap electricity and lets you use it when electricity is expensive. Whether that is worth £3,000 to £10,000 depends on three things: how much you use in the expensive hours, which tariffs you are allowed to join, and the installed price. For a typical home the numbers rarely add up today. For a home with an electric car or a heat pump on the right tariff, they come much closer.
Everything below comes from Fortyeight’s model, which replays a year of real Octopus prices against a household’s half-hourly use. These are modelled homes, not promises; run it on your own meter data for your figure. Not financial advice — a model, so check real quotes.
Is a home battery worth it? The answer by household
The column that matters is what the battery adds over the best tariff you could have without one. Comparing a battery on Agile with your current flat-rate bill flatters the battery, because part of that saving comes from the tariff switch, which costs nothing.
| Modelled household (London unless stated) | Best battery setup | Battery adds per year | Break-even price over 10 years |
|---|---|---|---|
| Typical, 2,500 kWh a year | Agile, 5 kWh | £187 | £1,701 |
| Typical, North Scotland | Agile, 5 kWh | £213 | £1,938 |
| High user, 3,800 kWh, mostly evenings | Agile, 10 kWh | £303 | £2,755 |
| Home worker, 3,500 kWh | Agile, 10 kWh | £275 | £2,506 |
| EV, 2,700 kWh plus 2,000 kWh charging | Intelligent Octopus Go, 10 kWh | £541 | £4,926 |
| EV, North Scotland | Intelligent Octopus Go, 10 kWh | £702 | £6,392 |
| Heat pump, 2,700 kWh plus 3,500 kWh heating | Agile, 10 kWh | £384 | £3,495 |
| Heat pump, North Scotland | Cosy, 10 kWh | £499 | £4,544 |
| 4 kWp MCS rooftop solar, 3,500 kWh | Flux, 10 kWh | £448 | £4,078 |
The break-even price is the most you could pay and get your money back within 10 years, with the battery losing 2% of its capacity each year. Compare it with the Energy Saving Trust’s figure of around £4,600 for a 5 kWh system, and it is clear why most homes without an EV or heat pump don’t come close.
Only one of the prices we use is published: the Energy Saving Trust’s £4,600 for 5 kWh. For larger batteries we use £7,600 (10 kWh) and £9,700 (13.5 kWh) as illustrations, because there is no verified figure for those sizes. At those prices, the best payback among these homes is about 10 years: a 5 kWh battery for an EV home on Intelligent Octopus Go in North Scotland. An EV home in London on Intelligent Octopus Go with 10 kWh takes about 17 years, and a heat-pump home in North Scotland about 16 years. A typical home takes more than 25.
Why the tariff does most of the work
For the typical London home in the model, moving from Flexible Octopus (a flat 27.93p/kWh) to Agile with no battery cut the yearly bill from £857 to £694, a saving of £163. Adding a 5 kWh battery on Agile saved a further £187. Half the gain comes free, with a smart meter and a tariff switch.
The reason is in the Agile prices. Over the 12 months to 25 October 2026, London’s Agile rate averaged 20.7p/kWh. It averaged 35.7p between 16:00 and 19:00, but only 16.5p between 02:00 and 05:00 and 15.7p between 13:00 and 16:00. A home that does most of its cooking, washing and TV outside the 4pm–7pm peak already captures much of that gap.
This depends on region. In North Scotland, Agile averaged 24.9p and the same typical home saved only £23 by switching. The regional Agile figures show where your area sits. Agile also includes Octopus’s Price Cap Protect, which limits the rate to 100p/kWh, but a past year of prices is no guarantee of the next.
The arithmetic of a typical home
A home using 2,500 kWh a year (Ofgem’s medium typical value since 1 July 2026) uses about 6.9 kWh a day. In the model’s load shape, only about 1.3 kWh of that falls between 16:00 and 19:00, and about 2.9 kWh between 16:00 and 23:00.
So a 5 kWh battery, which offers about 4.75 kWh usable after Fortyeight’s 95% usable-capacity assumption, already covers the whole evening. Each kWh it moves saves the difference between the expensive and cheap price, minus the 10% lost in a charge-and-discharge round trip. Between Agile’s 02:00–05:00 and 16:00–19:00 averages in London, that works out at about 17p per kWh. Over a year, that adds up to about £187. A bigger battery has little extra evening use to cover: 10 kWh adds only £23 a year more, and 13.5 kWh adds £1 more than 10 kWh. The battery sizing guide goes through this in detail.
Who comes closest to paying back
Electric car owners. Intelligent Octopus Go charges 6.93p/kWh between 23:30 and 05:30 and 37.93p at other times in London (5% VAT basis). That 31p gap is far bigger than Agile’s typical evening spread. Octopus Go and Intelligent Octopus Go both require an electric car; a battery on its own does not make you eligible.
Heat-pump homes. Cosy Octopus has three cheap windows a day and a peak from 16:00 to 19:00. A battery can charge twice a day and cover the peak, when a heat pump is still running. In London, Agile without a battery is already so cheap for this home (£1,458 a year against £1,890 on Flexible, and £1,902 on Cosy) that the battery’s extra gain is smaller, and Agile with a battery stays ahead of Cosy. In North Scotland the two are close: Agile is the cheaper tariff without a battery (£1,787 against £1,935), but with a 10 kWh or 13.5 kWh battery Cosy pulls ahead and adds £499 to £505 a year, against £436 to £472 on Agile. The heat pump guide sets out both regions.
Big evening users. A 3,800 kWh home that uses most of its power in the evenings gains about £303 a year from 10 kWh on Agile. That is more than a typical home gains, but still far below a realistic installed price.
MCS solar owners. With rooftop solar you can join Octopus Flux, which pays 30.31p/kWh for export between 16:00 and 19:00 in London. That makes a larger battery pay: 13.5 kWh adds £594 a year in the model. The tariff comparison covers eligibility for each one.
How to judge a battery quote: the price ceiling
Don’t start with the price. Start with your honest yearly saving, then work out the most that saving can justify.
- Take 12 months of your own half-hourly data and find the cheapest tariff you can join without a battery.
- Find the cheapest bill with the battery on any tariff you can join. The difference is the battery’s real saving.
- Multiply by about 9.1. That allows for capacity falling 2% a year, reaching 80% after 10 years, which matches the floor in Tesla’s warranty. The result is your 10-year price ceiling.
- If the quote is above the ceiling, the battery won’t pay for itself within its warranty.
Try it with a quote and a saving:
The default numbers are the typical London home: £187 a year against a £4,600 quote never pays back within 25 years. Change them to your own figures. Then take the installer question sheet to every quote, so you compare usable capacity, inverter power and warranty terms on the same basis.
Warranty and lifespan
The Energy Saving Trust expects batteries to last 10 to 12 years. Warranties vary, so read the actual document. Tesla’s UK Powerwall warranty (revision 1.16, effective 3 December 2025) lasts 10 years and guarantees 80% of capacity retained. It allows unlimited cycles for solar self-consumption, time-of-use shifting and backup, caps other uses at 37.8 MWh of throughput, and requires the battery to stay connected to the internet for the full 10 years.
Two points matter for the sums. First, any saving after the warranty period is a bonus you can’t count on. Second, tariffs that make a battery cycle more than once a day, such as Cosy, wear it faster. Check whether a warranty limits total throughput rather than years alone.
The VAT deadline: 31 March 2027
Under HMRC VAT Notice 708/6, installed energy-saving materials are zero-rated from 1 May 2023 to 31 March 2027. Batteries have been included since 1 February 2024, both those added to existing solar and standalone batteries charged from the grid. From 1 April 2027 the rate goes to 5%, not 20%. A battery bought without installation, for example to fit yourself, pays the standard 20%.
On a £4,600 quote, 5% adds £230. That is real money, but small next to the £2,900 gap between that quote and a typical home’s break-even price. Don’t let a deadline push you into a battery that doesn’t pay. The VAT deadline guide covers the timing of quotes, deposits and installation dates.
What the model assumes
- Prices: Octopus tariffs fetched from Octopus’s public API on 25 October 2026 (Octopus raised several time-of-use rates around 21 October). Agile uses actual half-hourly prices from 25 October 2025 to 25 October 2026. Import prices include 5% VAT. Household electricity in Great Britain is zero-rated for VAT from 1 October 2026 to 31 March 2027, so bills paid today are about 4.8% lower. Because a battery pays back over 10 years or more, the long-run 5% basis is the fairer one.
- Battery: 95% of nominal capacity usable; 90% round-trip efficiency; 3 kW inverter for 5 kWh and 5 kW for larger sizes; a cycle only runs when it saves at least 2p/kWh.
- Dispatch: the battery plans 36 hours ahead knowing exactly how much the home will use. Real controllers forecast less accurately, so treat the results as an upper-middle estimate.
- Households: synthetic profiles built on the Elexon Profile Class 1 shape and made more uneven, as single homes are. Your own meter data will give a different and more useful answer.
Fortyeight is independent and not affiliated with Octopus Energy, Tesla or any installer.