The application of Building-Integrated Photovoltaics (BIPV) coupled with Battery Energy Storage Systems (BESS) in smart buildings is known as an effective solution to enhance the energy performance of buildings. However, the economic viability of these systems remains a complicated and challenging matter due to high upfront costs, variable market prices, and fluctuating energy and economic policy schemes such as Feed-in Tariffs (FiT) regimes. This study investigates the Life Cycle Cost (LCC) based optimum sizing of BESS for BIPV-equipped residential buildings under multiple scenarios of FiT schemes and BESS market prices in Italy. For this purpose, a residential building equipped with the aforementioned energy systems is parametrically modeled and evaluated with key LCC indicators, including Net Present Cost (NPC) and Saving to Investment Ratio (SIR), to elaborate on the economic performance of BESS adoption and accurate cost-effective size optimization. The results reveal a reverse relationship between FiT rates and BESS market price, with cost-effective BESS size due to high upfront costs imposed by higher BESS market prices and higher financial revenue for electricity export to the grid as a result of higher FiT rates, both discouraging BESS adoption and self-consumption. The results evaluate the impact of these economic factors, considering various BESS market prices under low, medium, and high FiTs scenarios. Moreover, the results highlight that the current high BESS market price is a major barrier to its adoption in the building sector under most FiT scenarios. Furthermore, this study identifies the economic viability thresholds of the BESS market price in various FiT scenarios and provides techno-economic and policy implications to further incentivize and promote BESS application in buildings equipped with BIPV.