TL;DR: There is no single running cost or payback period for a diesel generator or battery system. Divide fuel and operating costs by the electricity actually delivered. For a battery, include charging energy, conversion losses, maintenance and capital costs. The worked example below is illustrative, not a customer result or quotation.
How do you calculate diesel cost per kWh?
Fuel cost per kWh = litres consumed × diesel price per litre ÷ kWh delivered.
Use a fuel log and an energy meter over the same period. A generator's kVA rating is not its delivered kW; power factor and loading matter. Dividing annual expenditure by operating hours alone produces rupees per hour, not rupees per kWh.
Add maintenance, consumables, repairs, delivery and any applicable site compliance costs. For total cost of ownership, also include purchase, installation, financing, major overhauls and residual value. Separate one-time expenses from annual expenses.
Worked example: an assumed 30 kW average load
These inputs are chosen to explain the arithmetic. They are not measured TOBOR deployment data, market fuel prices or a manufacturer fuel-consumption curve.
| Input | Illustrative assumption |
|---|---|
| Average electrical output | 30 kW |
| Operating hours per day | 8 |
| Operating days per year | 300 |
| Fuel consumption | 8 litres/hour |
| Diesel price | ₹100/litre |
| Annual maintenance | ₹60,000 |
Annual electricity delivered = 30 × 8 × 300 = 72,000 kWh.
Annual diesel consumed = 8 × 8 × 300 = 19,200 litres.
Annual fuel cost = 19,200 × ₹100 = ₹19,20,000.
Fuel plus assumed maintenance = ₹19,20,000 + ₹60,000 = ₹19,80,000/year, or ₹27.50/kWh. This operating-cost subtotal excludes purchase, financing, overhaul, installation and other site costs.
Replace each assumption with the site's measured inputs before making a purchase decision. At low loading, fuel consumption per delivered kWh may differ substantially from the example.
How do you calculate battery operating cost?
Charging cost per delivered kWh = charging electricity cost per kWh ÷ round-trip efficiency.
For illustration, ₹8/kWh charging electricity and 90% round-trip efficiency give ₹8.89 per delivered kWh before maintenance and capital costs. Delivering the example's 72,000 kWh would require 80,000 kWh of input energy and cost ₹6,40,000 for charging alone.
Solar energy also has a cost: include solar installation and maintenance, or the value of export revenue forgone when solar is stored instead. Grid charging tariffs, demand charges, auxiliary consumption, battery degradation and replacement affect the result. Use efficiency and usable capacity at the relevant operating conditions.
What battery capacity would this example need?
A 30 kW load for eight continuous hours needs 240 kWh delivered to the load. Nameplate capacity must account for usable state-of-charge limits, discharge conversion losses, ageing reserve and auxiliary loads. The inverter must also support peak and starting loads.
A smaller battery may still be useful for shorter outages or peak shaving, but it cannot be assumed to replace the full eight-hour duty. Charging time and available grid or solar power also constrain the design.
How should payback be calculated?
Simple payback = incremental installed project cost ÷ annual net cash savings.
Compare the same load, backup duration and reliability requirement. Subtract charging, maintenance and other recurring costs from avoided diesel and other evidenced savings. Do not count the same benefit twice or subtract annualised capital cost and then count the full capital cost again in simple payback.
If annual savings are zero or negative, simple payback is not achieved. Simple payback also omits financing, discounting and future replacements; a full project model should include those cash flows.
What information should you send TOBOR?
Provide interval load data, outage duration, generator fuel logs, electricity bills, solar generation or export records, critical-load requirements and available installation space. TOBOR can use those inputs to propose a system and a site-specific comparison.
- Compare TOBOR battery systems
- Plan diesel generator replacement
- Request a site-specific cost model
- Understand DG compliance questions
Method and limitations
All figures in the worked example are explicit assumptions calculated on this page. No customer savings, fuel price forecast or guaranteed payback is claimed. Review the inputs against current supplier quotations, utility bills and generator test data before using the calculation for procurement.