Grid-Scale Battery Decommissioning Provision

Convert grid battery dismantling quotes, recycling credits, and restoration allowances into a present-value reserve requirement you can document for auditors.

Total usable energy capacity of the battery system expressed in megawatt-hours.
Contracted cost to remove, transport, and dispose of each installed MWh before credits.
Expected operating life in years remaining before the retirement event occurs.
After-tax discount rate applied to provisioning calculations.
Optional. Defaults to 2.4% when blank to reflect long-term services inflation.
Optional. Expected recycling value per MWh that reduces the gross dismantling cost. Defaults to $0 when blank.
Optional. Soil remediation, pad removal, or interconnection teardown costs added as a lump sum. Defaults to $0 when blank.

Financial planning aid—validate cost, inflation, and discount assumptions with engineering and accounting teams before booking reserves.

Examples

  • 600 MWh system, $45,000/MWh dismantling, $8,500/MWh credit, $250,000 site work, 12 years, 6.5% discount, 2.4% inflation ⇒ Nominal cost $23,772,143.37; present-value provision $13,523,217.65; reserve $22,538.70 per MWh.
  • 350 MWh system, $38,000/MWh dismantling, no credits, no site work, 8 years, 5% discount, defaults inflation ⇒ Nominal cost $16,987,373.21; present-value provision $11,493,925.63; reserve $32,839.79 per MWh.

FAQ

Why does the calculator escalate costs before discounting them?

Provisioning standards typically require forecasting the nominal cash outlay including inflation, then discounting to present value using your treasury-approved rate. This mirrors IFRS and FASB guidance for asset retirement obligations.

How should I choose the discount rate?

Use the after-tax rate that matches your corporate treasury policy for long-term obligations. Many utilities apply their weighted average cost of capital or a risk-free curve plus a risk premium.

Can I include contingency allowances?

Yes. Add contingency dollars to the site restoration field or bake them into the dismantling cost per MWh so they scale with system size.

What if recycling credits exceed dismantling costs?

The tool caps credits at the base cost per MWh so the provision never becomes negative. Excess upside can be modelled separately in sensitivity analyses.

Additional Information

  • Result unit: US dollars for both nominal future spend and present-value reserve, plus a per-MWh view.
  • Inflation defaults to 2.4% annually when left blank, reflecting long-term services inflation guidance.
  • Recycling credits reduce dismantling costs but are capped at the base cost to avoid negative provisions.

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