The battery surge has begun, with about 20,000 installations expected this year. Seventy percent of solar customers want batteries and 5% of new residential solar sales include storage. Last year, the total number of battery installations was estimated at 6,750, totalling 52MWh.
These numbers, released by solar consultancy SunWiz in its Battery Market Report 2017, will cause a riot of enthusiasm among installers who are geared up to do the work and have been waiting for consumers to “get” storage.
As the technology continues to become cheaper on a dollar-per-kWh basis, homeowners will begin to pay more attention to the possibility of saving some of their unused solar energy for later. But it still isn’t cheap, the report finds.
There are two storage markets: retrofit and new-build, with new-build customers generally being wealthy folk who haven’t touched PV until now, SunWiz says. Despite smaller capacity units working out as better value, the trend is towards larger batteries, the report found.
SunWiz’s research shows minimum installs are about 3.6kWh, with the most common about 6.4kWh. However, the trend is for larger units capable of 8-10kWh.
Enphase technology is common at the smaller end, with LG and Tesla making up larger end.
“Small might be better financially but people aren’t buying for financial outcomes,” says SunWiz managing director and founder Warwick Johnston. “They’re buying to get a sense of energy independence.”
Wealthy customers are motivated by loftier causes than mere economics, Johnston says, and they are often the ones opting for larger storage. They may also be installing solar for the first time. Smaller storage solutions are more common in retrofits, where PV system owners know their consumption and what their rooftop array is capable of.
The payback challenge
The investment in storage is still balanced between ideological and rationally economic. Larger storage systems bring much longer payback times than smaller systems, the report says. As the technology becomes cheaper, “it makes more financial sense to wait a few years”.
Payback is shorter for consumers with higher levels of consumption. It also makes a difference which state they’re in, with households in South Australia seeing shorter payback periods (because of higher electricity prices and sunshine levels) and Tasmanians having to wait longer for their investment to pay off.
On modelling of a 5kW solar system with a Tesla Powerwall 2 and 25kWh/day consumption, payback by capital city worked out around 7.5 years for Adelaide, 10.5 years for Brisbane (because of low electricity prices) and about 10 years for Melbourne and Sydney.
The analysis showed payback is quickest for users with higher consumption, because “customers with higher levels of consumption can also make greater utilisation of the battery – in part because they spill less energy and because the battery has greater opportunity to drain each day”.
The report found customers who own batteries and consume more energy have lower percentage of days where the battery isn’t fully discharged at the end of the day. They also have fewer days when the battery spills energy due to being charged to full capacity by solar.
In one example, it found a PV-battery system would provide all of a user’s electricity needs 75% of days for those with 15kWh/day consumption levels, but only 7% of days for those with 25kWh/day consumption.
“Energy may be a commodity but batteries are anything but a commodity,” SunWiz says in the report, which includes data from SolarQuotes which ranks battery brands by cost per total warranted kWh, with one cycle per day.
Tesla’s Powerwall 2 places first, followed by GCL’s E-KwBe unit.
“With most batteries offering power at over 40c/kWh over their lifetime, it’s hard to make a buck from solar storage, unless you can cycle multiple times per day,” the report says.
On its estimates, NSW accounted for 33% of installations, Queensland 29%, Victoria 18%, South Australia 10%, Western Australia 8% and the ACT 2%.
Last year was also a standout for major projects, with 11MWh of storage installed in 17 projects across Australia, including 2MW at Sandfire’s DeGrussa mine in Western Australia and 2MW at the Nauiyu (Daly River) community in the Northern Territory.