This paper investigates the impact of residential photovoltaic (PV) battery systems in a real test system with the goal of system peak load shaving. In order to encourage residential investors, a levelised feed‐in tariff (LFiT) scheme is introduced. Accordingly, two proposed cases and relevant suggestions are presented to reach a better performance. The profitability of the project is apprised via several economic criteria such as net present value, simple and discount payback period years (PBY and DPBY), internal rate of return (IRR), benefit to cost ratio, net cash flow, and levelised cost of energy. Moreover, different levels of peak shaving subject to customers’ participation and the size of the PV‐battery system are also obtained. An actual test system regarding 1‐year recorded data is employed to elevate the precision of results. Obtained results demonstrate that in the current situation in Iran, the PBY is about 5.83 years and the IRR is about 0.43. Meanwhile, the ratio of the LFiT should be about 3.5 to reach the same result as the current circumstances. Finally, a sensitivity analysis on systems’ parameters is performed to identify the impact of these parameters on economic indices.