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title: "Scenario guide: small business — demand charge reduction and backup power" description: "How a small commercial premises in Perth might use battery storage for demand charge reduction, backup power and faster payback." lastUpdated: "27 Feb 2026"

Scenario guide: small business premises

This is an illustrative scenario based on typical small commercial operations in Perth, not a specific business case study.

Business profile

• Type: Small retail shop or professional office (~150-200 m²)
• Operating hours: 8 am - 6 pm weekdays, half-day Saturday
• Daily usage: ~35-50 kWh (higher than residential due to commercial HVAC, lighting, equipment)
• Peak demand: 8-12 kW during summer afternoons (HVAC + equipment)
• Tariff: Synergy C1 or L1 commercial tariff with demand charges

System

• Solar: 15-20 kW PV (commercial rooftop)
• Battery: 20 kWh usable, three-phase hybrid inverter
• Goal: Reduce demand charges, provide business-critical backup, faster payback than residential

How this typically plays out

Small businesses face a different cost structure from residential customers. Commercial tariffs often include demand charges, a per-kW fee based on your peak 30-minute demand in the billing period. A single afternoon spike from running HVAC, ovens, or machinery can set your demand charge for the entire month.

Peak shaving: This is where batteries are most valuable for commercial premises. The battery monitors grid import and discharges during demand spikes to keep your peak draw below a target threshold. Reducing peak demand from 12 kW to 8 kW can save $200-400/month in demand charges alone, depending on your tariff.

Daytime solar alignment: Unlike residential users who generate solar while at work, businesses actually use energy during solar hours. This means high direct self-consumption rates (60-80%) even without a battery. The battery's primary role shifts to peak shaving and backup rather than time-shifting.

Business-critical backup: A power outage during business hours means lost revenue, spoiled stock (for food businesses), or disrupted client meetings. A 20 kWh battery can run essential business loads (POS systems, fridges, lighting, internet) for 4-8 hours, enough to ride out most grid events or close the business in an orderly way.

Faster payback: Commercial systems typically achieve payback in 4-6 years due to the combination of demand charge savings, higher self-consumption value (commercial tariffs are often 28-35c/kWh), and the operational cost of downtime. This compares favourably to the 6-9 year residential payback.

Key takeaways

• Demand charge reduction is often the biggest single saving for commercial batteries, sometimes worth more than energy arbitrage.
• Size the battery to your peak shaving target, not just your overnight load. A demand analysis of your last 12 months of bills reveals the optimal battery capacity.
• Three-phase is standard for commercial premises. Ensure your battery and inverter support three-phase operation.
• Federal STCs apply to commercial batteries up to 100 kW. However, note that the May 2026 capacity tapers (60% for 14-28 kWh, 15% for 28-50 kWh) affect larger commercial systems more significantly.