How much do batteries really cost?

We frequently have conversations about the price of lead acid batteries versus the price of Tandem’s LiFePO4 lithium batteries.  Many of these conversations end with the realization that “cost” is more important than “price”.

Price is easy to determine. It is the amount you pay up front. 

Most buyers will compare the price per rated amp hour indicated on the battery or price per rated watt hour (i.e. the voltage times the rated amp hour). These calculations are great for comparing one lead acid battery to another, but not very useful in comparing lead acid batteries to LiFePO4 lithium since the performance of the lithium cells is quite different than lead acid.

Lead acid battery specification are typically based on lab tests at 77⁰ F, a 20 hour discharge rate, a maximum 50% depth of discharge even for deep cycle batteries, no Partial State of Charge (PSOC) discharges and diligent battery maintenance.

Real life operation, especially in hot climates like the US southwest, does not match these controlled lab tests and can dramatically reduce the number of cycles by 50% - 75% in real world usage.  As an example, every 10⁰ C (18⁰ F) increase in temperature reduces the number of cycles for a lead acid battery by 50%.

Since Tandem’s LiFePO4 lithium batteries can last many times longer than lead acid batteries and do not have the same limitations for temperature, depth of discharge and rate of discharge, a more meaningful financial comparison is the “lifetime cost” of the battery.

Lifetime cost is total number of watt hours that can be produced by the battery during its operational life as compared to the initial cost of the battery. It is based on the number of times a battery can be discharged and the depth of each discharge.

The bottom line is that the purchase price of lithium batteries is higher than lead acid batteries while the overall lifetime costs are lower.  In addition to the many operational advantages, Tandem lithium batteries can be maintained at a component level thus avoiding costly replacement of batteries. 

The bottom line is that lithium is the smart decision for projects with sufficient budget.  For budget challenged projects, a hybrid Tandem – lead acid battery bank may be a good choice.   Tandem is designed to work in parallel with lead acid battery strings which is a game changer.  Lithium versus lead acid is no longer a yes or no decision, but rather, a question of how many of each.