What is round-trip efficiency and how much does a battery degrade over 10 years?

Two different questions hiding in one datasheet

When a supplier says a battery is “rated for 10 years,” two separate promises are bundled together, and buyers often confuse them. The first is about efficiency — how much energy you get back each time you cycle the battery. The second is about degradation — how much of the battery’s storage capacity survives after years of use. A system can be very efficient on day one and still lose a chunk of its capacity by year ten. You need to read both numbers to know what you are actually buying.

Both numbers ultimately decide your cost per stored unit of energy, which is why they belong right next to price when you compare offers.

Round-trip efficiency: the energy you don’t get back

Round-trip efficiency (RTE) is simple to state: put 100 units of energy in, and RTE is how many units you can take back out. If RTE is 88%, then storing and re-dispatching a unit of electricity quietly costs you 12% of it. Over thousands of cycles, that “loss tax” adds up.

The catch is where you measure it. At the raw cell level, LFP (lithium iron phosphate) chemistry is superb — cell RTE is often 97–99%. But no one uses bare cells. Once the pack is wrapped in a power conversion system (PCS), a transformer, thermal management and control electronics, the useful number — measured at the AC grid connection — drops to roughly 85–92% AC-to-AC for a well-built LFP system, with 90% or better considered very good.

Where does the missing energy go?

• PCS conversion. Turning AC into DC to charge, then DC back to AC to discharge, loses a few percent each way in the inverter.
• Transformer and cabling. Stepping voltage up and down and pushing current through conductors dissipates heat.
• Auxiliary and cooling loads. The HVAC that keeps cells in their happy temperature band, plus controls, BMS and standby draw, all consume power — and in India’s heat, cooling is not optional.

This is why you should always ask for the AC-AC RTE at rated conditions, not the flattering DC or cell number. Indian tenders take this seriously: SECI (Solar Energy Corporation of India) standalone-storage contracts specify a guaranteed minimum RTE — around 85–86% — with liquidated damages if the system falls short.

Degradation: why capacity fades over the decade

A battery does not hold its full capacity forever. Every LFP cell slowly loses the ability to store energy through two overlapping processes:

• Calendar ageing happens even when the battery just sits there. Chemical side-reactions — SEI-layer growth on the anode, slow electrolyte breakdown — advance with time and are made worse by heat and by parking the battery at a very high state of charge.
• Cycle ageing happens each time you charge and discharge. It speeds up with deep cycling, high C-rates (charging or discharging fast), and again with heat.

For a well-designed, moderately used LFP system, capacity typically fades about 2–3% per year. That is why the common warranty shorthand — “10 years, 6,000 cycles, or 70% end-of-life capacity” — hangs together: after roughly a decade of daily cycling, a healthy LFP battery is expected to still hold around 70% of the energy it started with. State of Health (SoH) is the industry’s word for this remaining fraction; a battery is usually treated as end-of-life somewhere between 60% and 80% SoH.

Real Indian contracts put hard numbers on this. In SECI’s 600 MW / 1,200 MWh standalone tender, the guaranteed usable energy declines from 1,200 MWh to about 840 MWh over 15 years — that is 70% retention at year 15, with the developer on the hook for it.

What speeds ageing up — and what you control

Degradation is not fixed by chemistry alone; how the battery is operated matters as much:

• Temperature is the single biggest lever. Sustained cell temperatures above ≈35°C accelerate both calendar and cycle ageing — which is exactly why cooling design is critical in India and why it also eats into RTE.
• Depth of discharge (DoD). Regularly running from very full to very empty stresses cells more than shallower cycles; sitting above 90% or below 10% SoC is hardest on them.
• C-rate. Charging or discharging fast (a 1C or 2C duty) ages cells faster than a gentle 0.25C solar-shifting duty.

The same LFP pack can last very different lengths of time depending on how hot, how deep and how fast you run it — which is why a warranty must state the assumed cycles per year, temperature band and DoD, not just a headline year count.

Augmentation: holding capacity flat on purpose

If capacity naturally fades to ≈70%, how do multi-year contracts promise steady usable energy? Through augmentation — planning to add fresh battery modules at set points (often around year 5 and year 10) to top the system back up to its guaranteed energy. It is usually far cheaper to build in modest augmentation later than to massively over-size the battery on day one, because cell prices keep falling and you avoid paying up front for capacity you won’t need for years. When you compare bids, check how a supplier meets its long-term energy guarantee: over-sizing, augmentation, or a mix — each has very different cash-flow and cost implications, as covered in our BESS price guide.

What this means for you

Do not let a single “10-year” headline stand in for the two numbers that matter. Ask every supplier for: the AC-AC round-trip efficiency at rated conditions (not the DC or cell figure); the capacity-retention curve with its assumed cycles per year, temperature and DoD; the SoH at end-of-warranty (often ≈70%); and the augmentation plan that keeps usable energy where you need it. These are the same performance guarantees that serious Indian tenders enforce, and they flow directly from cell quality — so read this alongside our note on LFP vs NMC chemistry and the fundamentals of what a BESS is. Our own containerised and C&I products are built on LFP with these guarantees in mind. To see how efficiency and degradation change the lifetime economics for your specific load and tariff, run the numbers in our savings calculator or talk to our team.

Technical snapshot as of July 2026. Efficiency, degradation and warranty terms vary by cell, design and duty cycle; verify current datasheets and guarantees with your supplier before financial decisions.