Solar + Batteries Vs. Generators: Batteries are Increasingly Competitive
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ReVision Energy is pleased to announce that as of October 2016, we are a Tesla Energy Certified Installer, meaning we are authorized to install the Tesla Powerwall and Tesla Powerwall 2.
This certification adds to our extensive and diverse experience designing and installing advanced energy storage systems from Sonnen, Pika Energy and Adara, as well as Schneider Electric, SMA and Outback Power.
In the year and a half since Elon Musk announced Tesla’s Powerwall, we’ve seen a renewed level of interested in solar + battery products and some impressive gains in the technology “arms” race to develop the energy storage solutions of the future. Don’t miss our three-part feature published a year ago.
Here are three things we’ve seen this last year that we think speak to what will happen in battery storage in the years ahead.
1. Solar + Storage Gradually Becomes the Default
The rapid progression and cost reduction of advanced battery technology is now making it practical for everyone to explore the combination of a solar electric system with modern battery storage options (solar + battery).
Because storage is a critical part of the large-scale transition to renewable energy, every solar electric system we are designing and installing today is “forward compatible” with storage, whether or not a battery pack is installed at the time of the solar installation. Not only can batteries keep the lights on when the sun or grid is down, but they can also support the utility grid by filling intermittent gaps in renewable energy production when clouds pass over or wind subsides.
Here’s how a solar powered battery pack compares to a home standby generator:
Battery Vs Generator
|Advanced battery energy storage system||Fossil Fuel-Powered Home Standby Generator|
|Maximum peak power (kW)||4.5 – 21 kW||7-10 kW|
|Energy Storage||10.6 – 40.5 kWhr||Depends on tank size|
|Duration||Forever, if solar is available||Until the fuel runs out|
|Backup the whole house||Possible but usually we design critical loads only for longer run-times||Yes|
|Backup critical loads forever||Yes – just add sun!||No, limited by fuel tank|
|Noise||Silent||70-80 dB (As loud as a city street)|
|Service required||None||Annual service: oil change and filters|
|Warranty||10 years||0-2 years|
|Internet-enabled||Yes, included in cost||No|
|Future smart home ready||Yes||No|
|Future smart grid ready||Yes||No|
|Provides protection against solar regulatory changes||Yes¹||No|
|Requires weekly ‘exercise’ to be available||No||Yes|
|Net Installed Cost||$8,500 – $15,500²||$7,000|
|Plus gas install||N/A||$500|
|Annual service cost (est)||None||$200|
|Annual fuel cost (est)||None||$300³|
|Expected system life||15||12|
|Total cost per year||~$800||$1,125|
|Total cost for 10 years||$8,500 – $15,500²||$18,250|
¹ Installing energy storage provides some mitigation of risk associated with future Net Metering uncertainty and other rate design risk by allowing a customer to maximize self-consumption, minimize demand charges or optimize energy use patterns for a possible Time of Use rate.
² Net Cost: Assumes storage is charged by a solar energy system and so is eligible for the 30% federal tax credit. Price range reflects various sizes of batteries and power capabilities.
³ Assumes 100 G a year at $3/G propane
While there are some limits to its power output capabilities, the battery pack is infinitely cleaner, can run indefinitely under proper design circumstances, has no recurring maintenance needs, and offers a range of capabilities—such as “self-consumption” of solar power and grid support services—not offered by generators. As technological evolution and fierce competition push down the sticker price of battery backup units, we expect the next 3-5 years will show a seismic acceleration in the adoption of residential battery systems.
2. Competition is Good
The world’s appetite for energy storage is clear, and now is a moment where manufacturers — LG Chem, Sunrun, Juicebox (now Adara), Pika Energy, Sonnen, Samsung, Sony, Panasonic and Tesla Energy, to name a few — are working rapidly to develop solutions that can scale to meet the enormous global demand for energy storage.
At ReVision, our goal is and always has been to install high-quality, dependable, long-lived equipment for our customers. Our engineering team has been following batteries for a long time and we have invested time with dozens of product vendors researching the best products out there.
Our Energy Advisors would be happy to have the opportunity to talk with you about your particular application and to see what makes the most sense for you.
3. Policy Needs to Catch Up
One of the most compelling aspects of including behind the meter energy storage with distributed solar energy systems is that those energy storage systems can not only deliver value to the owner (backup power, time-of-use-load-shifting or demand charge reduction), but they can also help provide value to the grid overall.
When aggregated, customer-sited residential or small commercial energy storage systems can provide a range of so-called “grid support services” including peak shaving, frequency response, a voltage response, as well as being part of a smart and flexible grid that enables high penetration of renewable energy of all kinds. Battery systems and distributed solar systems are two types of solutions collectively known as DERs (or Distributed Energy Resources) which can provide these services to the grid and the utilities, frequently at much lower cost than if the utilities were to do the same thing centrally.
With appropriate public policy and rate setting, that means a solar customer might get paid extra for the services his or her battery is providing to the grid, even while saving all other ratepayers money too because the system can defer the need for expensive, central utility owned infrastructure. This is the broader outcome that ReVision, along with other renewable energy advocates, have been pushing for in utility rate cases and regulatory and legislative hearings around the region: a smarter grid, enabling broad adoption of renewable energy and strategic electrification, while reducing costs for all.
A handful of more progressive utilities, such as Green Mountain Power, recognize the inevitability of the transition to clean energy and are positioning themselves as the utility companies of the future.
In Green Mountain Power’s VT territory, a customer can share the cost to install a behind the meter energy storage system with the utility. The utility uses that battery to perform ‘grid services’ when the grid is up (lowering costs for all ratepayers) and the customer can use that battery for backup power when the grid is down. It is a clear win-win and is a good example of how a utility of the future might integrate DER’s to the benefit of both the installing customer and ratepayers generally.
For the planet’s sake, as well as that of our local economies, we need as rapid a transition to renewable energy as possible. The technology is here, and it’s the onus on regulators and legislators to modernize policy such that these technologies can fairly compete in the regulated monopoly of the electric grid.