Assessing the Feasibility of Behind-the-Meter Battery Storage Systems for Tariff Arbitrage in Uganda

The challenge of providing affordable electricity to users in sub-Saharan Africa persists. This study examines the feasibility of behind-the-meter battery energy storage systems (BESS) for tariff arbitrage. We utilize the time-of-use tariff from Umeme, a distribution utility in Uganda, to develop an optimization and economic model that compares electricity costs with and without a BESS for commercial use. Our results reveal that while storage systems can significantly decrease electricity costs through load shifting and peak shaving, the high initial investment required to install the BESS prevents them from being cost-effective. To explore alternative options, we examine a scenario with second-life BESS, which has lower capital costs and shorter lifetimes than a new BESS. Our results demonstrate that in this scenario, the payback of the system could be as low as 2 years. This study provides insight into potential solutions to reduce electricity costs for grid-connected users in sub-Saharan Africa.