TL:DR: Battery manufacturers take different approaches to warranties. This matters when deciding how much power to export to the grid and what minimum price makes it worthwhile.

Virtual Power Plants and Your Battery

In our previous blog, we discussed how Virtual Power Plants (VPPs) help the electricity grid by smoothing out peaks and troughs in demand. For customers, VPPs also provide an opportunity to earn extra income by selling electricity when wholesale prices are high.

But what about your battery warranty? Exporting electricity to the grid increases battery use, which can shorten the warranty period depending on how it’s structured. Let’s explore what that means for different manufacturers.

How Battery Warranties Work

Most battery warranties are based on two factors:

Time (e.g., 10 years)
Energy throughput (total amount of energy cycled through the battery)

The warranty expires when either limit is reached. Here are some examples:

Sigenergy 8kWh: 10 years, 70% of Day 1 capacity, or 23.77 MWh throughput (whichever comes first).
BYD HVM 8.28 kWh: 10 years, 60% of Day 1 capacity, or 25.62 MWh throughput (whichever comes first).
Sungrow SBR 9.2 kWh: 10 years or 4,000 cycles, with 70% capacity retention.

Other brands, such as Tesla, offer a 10-year warranty with 70% retention, but only if the system remains connected to the internet most of the time. If it isn’t, the warranty may be cut to just four years—we’ve seen this happen with another brand as well.

In short: most warranties guarantee around 70% capacity after 10 years, but the fine print (throughput limits, internet connectivity, cycle counts) matters.

The Trade-Off: Selling to the Grid vs Warranty

The Federal Battery Rebate scheme was designed to encourage homeowners to sell electricity into VPPs. But here’s the catch:

Exporting electricity adds to your battery’s energy throughput, which can shorten its warranty.
To offset this, you need to ensure the price you’re paid makes it worthwhile.

Let’s run the numbers.

A Simple Example

Using the Sigenergy 8kWh:

Total throughput: 23.77 MWh
Battery cost: $4,995
Storage cost = $0.21/kWh

If charging costs 5c/kWh, you’d need to sell electricity for more than 26c/kWh just to break even. Selling above this price is where you start to see real value.

Wholesale prices often exceed this at night, so in many cases you wouldn’t be losing out.

When It’s Worthwhile

Two main factors determine profitability:

Input cost – the price of electricity you put into the battery.
Export price – what you’re paid when selling back to the grid.

Profitability also depends on location. For example, Queensland wholesale prices are often higher than in Tasmania.

So, when are the best times? Typically:

Hot days when air conditioners are running at full tilt.
Cooler months, when heating demand spikes.

In fact, in Q2 this year there were 66 separate events where wholesale prices spiked above $5.00/kWh for 30 minutes. Selling at these times is extremely profitable.

Battery Longevity and Best Practices

Another key question: Does battery life depend on how you charge and discharge it?

Yes.

Lithium batteries can usually discharge down to 10% SoC (State of Charge) and recharge to 100%, delivering 3,000–6,000 cycles.
However, keeping the SoC within a narrower range dramatically increases lifespan. For example:

80% to 20% SoC = longer life
70% to 30% SoC = even longer

Other factors also help:

Keeping the battery cool
Avoiding high charge/discharge currents

Rule of thumb:
If you regularly sell around 25–30% of your battery’s capacity while keeping it cool, you won’t see a meaningful reduction in long-term performance compared to not exporting at all.

Research by Jeff Dahn at Dalhousie University confirms this in EV battery testing. (For the technical details, watch from 2:22 to 13:00 in his Video.)

Key Takeaways

Selling electricity via a VPP increases throughput, which can shorten your warranty.
Make sure the price you’re paid justifies the trade-off.
Manage charge/discharge levels and temperature to extend your battery’s life.

Done right, participating in a VPP should have minimal impact on your battery’s long-term performance.

Final Thought

Think of it like this: using your battery for VPPs is similar to using a new car (still under warranty) for Uber or DoorDash. It racks up kilometres faster and eats into the warranty allowance. But if you’re paid enough, and you treat the car well, the extra use won’t matter much.

Thinking About Adding a Battery?

Get in touch with us today and we’ll:

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Virtual Power Plants and Battery Warranties