The missing price feedback: Why studies overstate local grid peaks from synchronized home batteries under real-time pricing

Existing studies consistently find that home batteries optimized against real-time electricity prices create new load peaks in local distribution grids. This is because all assets respond to the same price signal in sync. However, most of these studies treat wholesale prices as exogenous, i.e., unaffected by that very response. This paper argues that treating prices as non-responsive biases the result: in reality, charging in low-price hours raises the wholesale price, which dampens the incentive to charge. In equilibrium, charging is spread out across hours. I test this by simulating households with rooftop solar and home batteries under a spot-based retail tariff, using a model of equilibrium wholesale prices calibrated to German data for 2025. With exogenous prices, my results confirm the finding from the previous literature: synchronous charging pushes the coincident import peak of the local grid to 83% above its no-battery level. With endogenous prices, the same fleet leaves the peak 6% below the no-battery benchmark. In other words, treating prices as endogenous reduces the coincident peak at high battery penetration nearly by half. This finding is robust across alternative price functions and exogenous price paths, different measures of the coincident peak, 20 scenario variations, and three historical years. I conclude that while new local peaks remain possible, particularly in grids where battery deployment runs ahead of the national average, the risk and magnitude are considerably smaller than the existing literature suggests.