Verdict (base case): NPV = −175,972 USD over a 12-year horizon at a 12.00% discount rate; simple payback = none within horizon; discounted payback = none within horizon; LCOS = 0.3823 USD/kWh. Equipment class: commercial Li-ion BESS, ~500 kWh usable, LFP chemistry (candidate family: CATL EnerC / BYD Battery-Box Commercial / Sungrow ST255kFlex-class cabinets). Location: LATAM (destination tariff and demand-charge schedules are owner-defined). Horizon: 12 years. Evidence date: 2026-01-15. Limitation: financial figures are computed outputs of the scenario model; all tariff, demand-charge, WACC, efficiency and DoD inputs are illustrative bounded assumptions, not sourced facts, and must be replaced with the buyer's own utility bill, EPC offer and lender term-sheet.

Decision summary
MetricValueRead
NPV @ 12% over 12 yr−175,972 USDNegative — base case does not clear WACC
IRR−5.74%Below the 12% hurdle — do not proceed on base inputs
Simple payback—Not reached within 12 years
Discounted payback—Not reached within 12 years
LCOS0.3823 USD/kWhCompare to avoided energy + demand cost
Base verdictAvoid / re-tenderRe-scope CAPEX, add solar PV, or renegotiate tariff

1. Use case definition

Mid-sized bakery chain operating between 8 and 15 production-retail stores across a LATAM country, plus a central dough-freezing commissary. Each retail site carries a walk-in freezer and a convection-oven block; the commissary adds blast chillers. The proposed scope is one 500 kWh commercial battery energy storage system (BESS) at the commissary, used for (i) daily peak-shaving of the dough-mixer and oven loads, (ii) short-duration backup of freezer circuits during grid events common in the region, and (iii) shifting solar from a planned rooftop PV array to evening bake windows. Equipment family referenced (illustrative, not endorsed): LFP commercial cabinet-class products such as CATL EnerC / BYD Battery-Box Commercial / Sungrow ST255kFlex liquid-cooled cabinets. Limits (torque, SOC window, DC voltage) must be read from the specific OEM manual revision supplied with the chosen SKU before site commissioning.

2. Inputs (bounded assumptions — replace before procurement)

InputBase valueUnitStatus
Usable energy500kWhModel assumption (use case spec)
Round-trip efficiency (DC)0.92—Model assumption (typical LFP cabinet round-trip, per CATL EnerC and Sungrow ST255kFlex datasheet families)
DoD90%Model assumption (typical LFP operating window)
Cycles per year330cycles/yrModel assumption
Project lifetime12yearsModel assumption
Tariff (energy)0.18USD/kWhIllustrative bounded assumption — confirm against destination regulator tariff schedule (e.g., CRE Mexico Comisión Reguladora de Energía, ANEEL Brazil ANEEL, ENRE Argentina ENRE)
Demand charge22USD/kW-monthIllustrative bounded assumption — confirm against same utility tariff schedule
WACC (post-tax)12.00%Illustrative bounded assumption — replace with signed lender term-sheet (e.g., IDB Invest IDB Invest, CAF CAF, or local bank)
Peak demand reduced120kWModel assumption
Energy shifted / day420kWhModel assumption
CAPEX (base)280,000USDModel assumption — confirm against EPC offer
Fixed OPEX / yr6,500USDModel assumption
Variable OPEX / kWh throughput0.005USD/kWhModel assumption
Degradation (capacity fade)2.0%/yrModel assumption — bounded default not in draft (recompute throughput by year)
Residual value0USDModel assumption — bounded default not in draft
Residual value at year12yrModel assumption — bounded default not in draft (aligned with horizon)

3. computed results

The following tables are outputs of the scenario model and are computed for this scenario. Inputs and arithmetic are not re-derived here; replace the assumption rows in §2 with buyer-specific values and re-run before any procurement decision.

TCO summary
MetricValue
CurrencyUSD
Horizon (years)12
Discount rate12.00 %
Total undiscounted cost (USD)367,178.58
Total discounted cost / PV of costs (USD)323,840.80
Total undiscounted benefit (USD)279,038.72
Total discounted benefit (USD)147,868.63
NPV (USD)-175,972.17
IRR-0.0574
Simple payback (year)—
Discounted payback (year)—
LCOS (USD/kWh)0.3823
Year-by-year cash flow
YearCost (USD)Benefit (USD)Net (USD)Discount factorDiscounted net (USD)Energy (kWh)
0280,000.000.0000-280,000.001.00-280,000.000.0000
16,500.0025,922.9319,422.930.892917,341.91148,500.00
26,630.0025,404.4818,774.480.797214,966.90145,530.00
36,762.6024,896.3918,133.790.711812,907.27142,619.40
46,897.8524,398.4617,500.610.635511,121.95139,767.01
57,035.8123,910.4916,874.680.56749,575.15136,971.67
67,176.5323,432.2816,255.750.50668,235.67134,232.24
77,320.0622,963.6315,643.580.45237,076.36131,547.59
87,466.4622,504.3615,037.900.40396,073.56128,916.64
97,615.7922,054.2714,438.490.36065,206.66126,338.31
107,768.1021,613.1913,845.090.32204,457.75123,811.54
117,923.4621,180.9313,257.460.28753,811.20121,335.31
128,081.9320,757.3112,675.370.25673,253.45118,908.61

4. Verdict by scenario

5. Mini certification block

Standard / cert.ScopeReference
IEC 62619Secondary Li-ion cells for industrial ESSIEC Webstore — IEC 62619
IEC 62933-5-2ESS safety, grid-integratedIEC Webstore — IEC 62933-5-2
UL 9540 / 9540AESS safety; thermal runaway fire propagationUL Standards — UL 9540
UN 38.3Transport of Li-ion cellsUNECE — Manual of Tests and Criteria, Section 38.3
IEEE 1547Interconnection (where applicable)IEEE Standards — IEEE 1547-2018
Local AHJ permitMunicipal electrical / fire permitOwner to secure against destination AHJ

Certifications are reference requirements, not assertions about any specific SKU. The exact compliance status must be read from the chosen OEM's datasheet and test report.

6. HS code reference block

HS code (2022 rev.)Description (short)MFN duty — destination
8507.60Lithium-ion accumulators (incl. cells and battery packs)Verify per USITC HTS: 8507.60 HTS search; cross-check with destination customs schedule at moment of entry.
8504.40Static converters; power supply units for BESS invertersVerify per USITC HTS: 8504.40 HTS search.
8537.10Boards/panels for electric control, EMS / BMS enclosuresVerify per USITC HTS: 8537.10 HTS search.

Disclaimer on duties: Duty, VAT and any antidumping / countervailing measures must be confirmed against the destination country's binding tariff schedule at the moment of entry. Tradvolt does not assert any specific MFN rate as fact. For EU entry consult EUR-Lex — TARIC / Combined Nomenclature; for MERCOSUR members consult each country's national tariff (e.g., Argentina NCM, Brazil NCM, Mexico TIGIE) and any Pacific Alliance preference in force.

7. OEM equipment reference (illustrative, not endorsed)

The 500 kWh commercial BESS class maps to several publicly marketed LFP cabinet families. The list is illustrative; the chosen SKU and its OEM manual revision govern all electrical, mechanical and SOC-window limits at the site.

For any chosen SKU, record: OEM manual title, document revision, DC voltage window, SOC operating window, recommended torque values for DC bus and rack bolts, and the stated round-trip efficiency. These limits are SKU-specific and are not modeled generically here.

8. Disclosure

This TCO is an illustrative model prepared by Tradvolt for procurement guidance. It is not a financial quotation and does not constitute investment, tax or legal advice. The financial figures in §3 are computed outputs of the scenario model for the bounded inputs in §2; every other number on this page is either a cited standard / HS reference or an illustrative assumption. Replace every input with values from the buyer's own bill, EPC offer and lender term-sheet before any procurement decision.

9. Next steps