An interesting market experiment is beginning to take shape in Australia that has significant implications for the way electricity is generated and distributed.
Over 1.5 million Australian homes now have solar panels on their roofs and one of the great arguments against the economics and practicality of solar is about to be challenged.
www.cleanenergyregulator.gov.au/...
Australian solar industry celebrates the New Year by ticking over 1.5m PV systems
1.5 million homes when Australia’s population is 23 million, would equate, on a per capita basis, to 20.7 million systems with the US population of 319 million.
The US currently has around 600,000 homes with solar according to the SEIA, so is trailing Australia in terms of PV solar reach to domestic households.
www.seia.org/...
It makes good business sense then that companies like Tesla and other market participants such as LG, have made Australia one of their first target markets for home energy storage systems capable of storing excess power generated by a solar system during the day for use by a household when the sun goes down.
A programme aired last night on the Australian ABC Science program Catalyst which investigates the potential impact of accessible energy/electricity storage and the disruptive potential this technology has is something I’d like to explore below.
Battery Powered Homes
“If energy companies ignore them, they will watch their businesses crumbling in front of them”
Link to Catalyst energy storage programme and transcript —
www.abc.net.au/…
On May 1 2015 when Elon Musk first launched the Powerwall, one of the things that seemed to be missing, was a major part of the electricity market. Elon gave a couple of big reasons for introducing battery storage below — as a back up system or if you are completely off grid.
8:39 : well, it gives you peace of mind so if there's a cut in the utilities you're always gonna have power, particularly if you're in a place that's very cold. Now you don't have to worry about being out of power if there's an ice storm.
You can actually go, if you want, completely off grid you can take your solar panels, charge the battery packs and that's all you use so it gives you safety, security, and it gives you a complete and affordable solution
What seemed to be missing and it is something that Elon/Tesla have now focused on, was being able to store your own surplus PV solar electricity to charge your batteries during the day. To be able to use at night when most of your electricity consumption may be. Not be disconnected from or off the grid entirely, but also not be paying for power if you had generated enough of it during the day.
The Catalyst program looks at just such an installation both before and after a storage system is installed. A market distortion corrected as the household was selling surplus solar power to the utility for 7c kWh, yet buying back at night for 28ckWh.
With Solar alone :
Basically, 60% of Josh's household electricity is at night-time. So even though the solar panels are generating 76% more power than he needs, he's still very reliant on the grids and also getting quite a big bill as a result.
With Solar plus an energy storage system with smart software management :
Basically, 53% of the household's electricity needs are now coming from the battery. 44% is still coming from their solar panel during the day, and only 3% from the grid. So it's a really dramatic shift.
Expansion capacity :
One of the limitations of solar PV systems with centralized inverters, is that it’s difficult to increase in capacity/size once installed on you roof. Battery storage systems on the other hand, are designed so that as a household can afford it, additional storage can be added to the system.
This means that early adopters will still be able to average down their total cost of storage as the battery cost curve comes down. May not sound like much, but certainly in Australia a 5kWh PV system installed in 2009 cost around $25,000 with the same capacity today, fully installed for $5,000-$8,000 after incentives. Deferring purchasing in the hope for a steeper discount starts to make less sense if the consumer is forgoing the cost savings from generating and consuming their own power and can add to their system as prices come down — the best of both worlds really.
So you're likely to see households put small batteries systems in at first, just to deal with the peak pricing period. And then as battery prices come down, perhaps upsize their battery systems when the payback period is more attractive. It's very much a modular system, so you can start with three kilowatt hours and move up six kilowatt hours. You can have a massive power station at the end if you want.
Retailers are offering these systems already
Energy company AGL is now offering a battery and inverter package for under $10,000.
There will be Blood Sunshine
Energy storage has incredible potential for disrupting traditional business models. Catalyst explores a few of these. The first being smart software which allows your power company to manage and draw from your battery storage & then pay you the proper rate for this power.
Retailers buying storage from homeowners
You can become a part of the master controlling system that is our national grid, and earn a few extra quid on the side.
It's hooked in to the wholesale price of the national electricity market, and every now and again, you will see this happen.
... their power company, Diamond Energy, is using their battery power and has agreed to pay the Mannings accordingly.
Strata title — units and housing estates — ie community solar
Investors are reluctant to put in renewable energy technology because it's the tenant that gets the benefit. So we've got 1.4 million houses in Australia with rooftop solar, but hardly any in strata.
The building comprises three apartments, with a central battery depot. What's groundbreaking is not so much the technology, it's that Jemma has developed a governance model where, for the first time, the strata owners become the main energy supplier to the tenant.
Jemma Green
And so they've got 24-hour renewable power, low-carbon electricity and also it provides a revenue stream for investors because the tenants pay their electricity bill to the strata company instead of paying it to the utility.
New Housing Estates
This is the Alkimos Beach development just north of Perth. It was started in 2012, and by the time it's finished in 2020, it'll have 6,000 homes, parks, schools, shops, a town centre and, as you can see, every single home has solar.
NARRATION
And with a development this size, you might go for a bigger battery, a much bigger battery. This is the mega battery now being built for Alkimos Beach.
….These larger scale lithium batteries are already starting to be deployed in remote off-grid communities, But Alkimos Beach represents the first time community-level lithium battery storage will be tried in an urban residential development.
Building Integrated Battery Systems
...we're thinking about things like working with Professor Maschmeyer to use prefabricated wall segments, for example, as, effectively, battery storage or power storage facilities. So imagine that in a large scale and the impact that will have on the emissions from the built space, which is a very significant impact on the environment.
I think that Catalyst has just touched on the enormous potential that affordable electricity storage presents.
Because opportunities as I imagine them are not just in ‘cleaning up’ the way electricity is currently generated but also offering independence from your utility, in new ideas leading to new industries & jobs and with developments such as Alkimos Beach, proving that community solar & storage is not just something ‘hippies’ do — they were just ahead of the curve as the first adopters.
Additional short news bulletins on the Energy Storage System roll out in Oz (3 minutes)
We take a look into the future present with the Tesla Powerwall. — tenplay.com.au/…
Tesla Powerwall: what this highly anticipated home energy storage system mean for the Australian energy market — www.abc.net.au/…