Battery Storage vs. Battery Backup: What is the Difference?

As solar continues to be popular across California where the sun shines an average of 300 days a year, battery systems are becoming just as important as the panels themselves. When you’re exploring your options, you’ll likely come across two terms: battery storage and battery backup. While these terms are often used interchangeably, they are not the same thing, though in many cases, they can be combined into one system.

Understanding the difference is key to choosing the right setup for your home, lifestyle, and energy goals.

Battery Storage: Maximize Your Savings

Battery storage systems are designed to store excess energy your solar panels produce during the day. That stored energy can then be used in the evening when your solar isn’t producing but your household is still using power. These systems are tied to the grid, meaning if your battery runs low, your home will automatically draw power from the grid. This will help decide what size battery you need when adding it to your solar system.

Why choose battery storage?

• Reduce your dependence on the grid

• Avoid high utility rates during peak hours (often 4–9 PM)

• Maximize your savings

  
  

When to run appliances with a battery storage system:

During the day (when the sun is up), not at night. This is the opposite of what we were always told to wait until off-peak to do laundry or dishes. That advice made sense when you were pulling from the grid during peak hours, but not when you have solar + storage. Using power-heavy appliances while your solar system is actively producing prevents unnecessary battery drain and avoids dipping into grid power.

Battery Backup: Be Ready When the Power Goes Out

A battery backup system is designed to keep the power on when there’s a blackout. It includes a transfer switch that detects when the power cuts off and immediately switches your home to battery power. This switch typically happens in seconds, meaning no fumbling with generators or sitting in the dark.  Most backup systems are designed to run only essential loads like refrigerators, lights, internet, and medical equipment so the battery lasts longer during an outage. It will not run your whole home on backup power. The standard backup battery runs the essentials. A system large enough to run your whole home at night is a significant investment.

Can You Have Both? Yes

Here’s where it gets important: A battery storage system and a battery backup system can be the same physical unit, but backup capabilities are not automatically included. You’ll need additional components like a critical load panel, transfer switch, and specific programming to enable automatic backup. Think of it like this, buying a car doesn’t mean it comes with four-wheel drive. Same vehicle, but the additional function adds more to the cost.

Why does it cost more?

• Specialized electrical work to separate essential loads (your home isn’t wired for that by default)

• Additional hardware (transfer switch, critical loads subpanel)

• Programming and permitting for code compliance

  
  

Yes, you’re adding to the cost of the investment upfront, but the peace of mind and protection it provides especially in areas prone to grid instability, PSPS events (Public Safety Power Shutoffs), or extreme heat is invaluable.

Cost vs. Savings: Is It Worth It?

Without a battery:

• You're subject to utility time-of-use (TOU) rates

• You get lower compensation for exported solar through NEM 3.0 (especially in California)

• You have no backup power during outage

  
  

With storage only:

• You use your system paired with your battery, avoiding high TOU rates, reducing your bills.

• You up the value of your home if you ever plan to sell it.

• Your home is more future-ready for EVs or smart home integration

  
  

With storage + backup:

• All of the above, plus protection during power outages

• Ideal for those working from home, with medical devices, or in outage-prone areas

  
  

Over time, your system pays for itself through lower utility bills, added home value, and long-term energy security. If you qualify for local or federal incentives (like the 30% federal tax credit), your payback period gets even faster. 

30% tax credit only available for systems that have been installed and submitted for PTO (permission to operate) by December 31st 2025.

Simple changes to your routine like running the dishwasher or doing laundry between 10 AM and 3 PM can extend your battery life, reduce grid reliance, and lower your monthly bills.

Final Thoughts: A Smart Upgrade for a Smarter Energy Future

Pairing your solar panels with the right battery system, it becomes a powerful tool giving you more control, better savings, and more reliability.

Whether you want to save money with a battery storage system, stay protected during outages with a backup setup, or combine the two into one powerful solution, understanding how these systems work will help you make the smartest investment for your home.

Battery Storage vs. Battery Backup: What is the Difference?

If you're ready to start the discussion about batteries give Planet Solar a call. We are here to help with two offices in California: Fresno and Palm Desert. If you have any questions, call one of our solar experts. You can reach us at 800-859-7652 or submit your information here and we will call you.