Factory BESS for TOU arbitrage + demand-charge savings does it pay back?
The market is full of "what is a battery" articles but almost no one puts honest payback numbers on the table. This page lays out the financial model straight: when it pays back, when it doesn't, and why.
Straight answer: if you are chasing profit from pure TOU arbitrage alone — charge cheap at night, discharge at the expensive midday peak — at Thailand's current industrial spread (about 1.5-1.7 THB/kWh) the battery usually does *not* pay back on its own. The battery's per-kWh "throughput" cost (degradation plus ~10-15% charge/discharge losses) eats almost all of that spread, leaving only a few tens of satang of margin per kWh. BESS pays back only when you stack benefits: ① cut the demand charge (the single biggest lever on the bill), ② pair it with existing solar to bank surplus midday generation for the evening, ③ use it as backup during outages. Factories with a high demand charge that already have solar have the best odds; factories hoping to speculate on the electricity price alone usually fail the math. See current TOU rates and the demand-charge mechanics.
How TOU arbitrage maths works — and why the spread usually isn't enough
The arbitrage idea is simple: charge during Off-Peak (cheap), discharge during On-Peak (expensive). Profit per kWh = price spread − battery cost per kWh − losses. But once you put real numbers in, the margin is far thinner than it looks.
| Item | Approx. value | Note |
|---|---|---|
| On-Peak price (incl. Ft) | ~4.3-4.5 THB/kWh | Cat 3-4, by voltage |
| Off-Peak price (incl. Ft) | ~2.7-2.8 THB/kWh | Charge the battery here |
| Raw spread | ~1.5-1.7 THB/kWh | Theoretical max margin |
| − round-trip loss (~10-15%) | −0.3 to −0.4 THB | Must charge in more than you draw out |
| − levelised cost per cycle | ~0.7-1.1 THB/kWh | battery cost ÷ usable cycles |
| = net margin per kWh (pure arbitrage) | often ~0 to 0.5 THB | Very thin — this is the crux |
Bottom line: after losses and degradation, the arbitrage margin per kWh is often just tens of satang. Multiply by cycles per year and compare against the large battery capex, and pure-arbitrage payback frequently exceeds 10 years — close to or beyond the battery's useful life. In business terms that is "not worth it" unless other savings are stacked on top.
The real lever: cutting the demand charge with peak shaving
A Cat 3-4 factory bill is not just energy (kWh) — it also includes a **demand charge** based on the highest power (kW) drawn in the month, billed in "baht per kW per month" by voltage: ~74.14 (≥69 kV) / 132.93 (12-33 kV) / 210.00 (<12 kV) THB/kW. A BESS that discharges during the few peak minutes of the month pulls the measured peak demand down, lowering the demand charge every month. That saving is "certain and repeats monthly" — unlike arbitrage, whose margin is thin and volatile.
Illustrative example (12-24 kV, demand 132.93 THB/kW):
If the BESS trims 100 kW off the monthly peak → saving 100 × 132.93 = 13,293 THB/month ≈ 159,516 THB/year. That saving, stacked on top of thin arbitrage and backup value, is what moves the payback equation "toward worth it" — actual numbers depend on your load profile, battery size and connection voltage, and should be modelled from your real bills by an engineer.
For the demand-charge mechanics in depth, see demand charge / TOU / TOD explained and the load-shifting tactics to cut demand charge. For using "solar + battery" to shave the peak directly, see peak shaving with solar + battery.
BESS cost, lifespan and degradation — why payback is so sensitive
Only a handful of variables decide worth-it vs not: (1) installed battery price per kWh, (2) usable cycles before it degrades to ~70-80% State-of-Health, (3) round-trip efficiency. Industrial BESS (lithium LFP incl. PCS/BMS/install) globally in 2025-2026 runs roughly US$180-580/kWh (large containerised systems cheaper, smaller systems dearer); in Thailand it tends to land in the upper half after import + installation. LFP lasts ~4,000-6,000+ cycles, ~85-90% round-trip efficiency, ~10-15-year life.
⚠️ The price figures are a market RANGE, not a quote. Real pricing depends on system size, cell brand, warranty, on-site electrical infrastructure and FX. Always model it from your factory's real bills and load profile.
See the detailed BESS price range at BESS price per kWh and when it pays off and the system overview at battery storage for factory solar.
Which factories it makes sense for — and which it doesn't (yet)
There is no single answer for every factory. Use the conditions below as a quick screen before committing capital:
| Factor | Likely worth it ✅ | Usually not yet ⚠️ |
|---|---|---|
| Demand charge | High + sharp, short peaks | Low, or flat load all day |
| Existing solar | Has solar + midday surplus | No solar, buys every kWh |
| Load profile | Heavy use in midday On-Peak | Heavy use at night (Off-Peak) |
| Outage risk / backup need | Outage is costly (needs backup) | Outages don't hurt / already has genset |
Read across: the more rows fall in the ✅ column, the better BESS pays back. A factory landing in ⚠️ on almost every row should wait for cheaper batteries or start with solar-only first.
Why "solar + BESS" is the stack that actually pays
Separately, BESS alone usually doesn't pay. Paired with solar, the maths shifts: the energy you store is no longer Off-Peak grid power (2.7-2.8 THB) but surplus midday solar at "near-zero cost" (which would otherwise be clipped or exported cheaply). The battery's effective spread becomes the full On-Peak price (~4.3-4.5 THB) minus degradation — far wider than grid arbitrage. Stack that with demand-charge shaving and backup, and you get three benefits on one battery investment. This is why we usually advise "solar first, then add BESS once the load profile / demand charge justify it."
See the combined-system overview at solar + battery + factory microgrid, and run the factory solar ROI as your baseline before adding a battery — or size it with the solar calculator.
**CapSolar builds your BESS payback model from your real bills** — not brochure numbers. We pull your 15-minute load profile, analyse the achievable TOU spread + demand-charge reduction + backup value, then tell you straight whether it pays back yet, and whether to start solar-only or add the battery now. With 150+ installations across Thailand, talk to our engineers to see the numbers for your own factory.
About the author
Prepared by the CapSolar engineering team, which has designed and installed solar and energy-storage systems for over 150 factory projects across Thailand. This article draws on the latest ERC tariff period, international BESS cost data, and the financial models we use with real clients. Figures are decision-support ranges, not a quotation.
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