What Is Round-Trip Efficiency?

Round-trip efficiency is the percentage of energy a battery returns after a complete charge-then-discharge cycle. Charge it with 100 kWh, discharge 90 kWh back out, and the round-trip efficiency is 90%. The rest is lost as heat in the cells and power conversion electronics.

Where the Losses Come From

No battery system is perfectly efficient. Energy is lost converting AC to DC on the way in, DC back to AC on the way out, and through internal resistance in the cells themselves during both charging and discharging. Modern lithium iron phosphate (LFP) systems, the dominant chemistry in commercial BESS installations, typically achieve 85-95% round-trip efficiency.

Why It Determines Arbitrage Economics

Every arbitrage cycle, charging cheap and discharging expensive, loses a slice of energy to round-trip inefficiency. A battery with 90% round-trip efficiency needs the sell price to exceed the buy price by more than that 10% loss just to break even, before accounting for degradation or other costs. Higher efficiency directly widens the profitable range of price spreads a battery can capture.

Neutron's Systems

Our Energy Storage Systems use LFP chemistry chosen partly for its strong round-trip efficiency, maximising the return from energy arbitrage and other dispatch use cases run through our energy platform.

What's a typical round-trip efficiency for a BESS?

Modern lithium iron phosphate (LFP) battery systems typically achieve 85-95% round-trip efficiency, accounting for losses in the battery cells themselves plus the power conversion electronics on both the charge and discharge side.

Does round-trip efficiency change over the life of a battery?

It typically declines slightly as a battery ages, alongside its overall capacity, since internal resistance tends to increase over thousands of cycles. This is a normal part of battery degradation and one reason arbitrage economics should be modelled conservatively over a system's full expected life.