Home battery storage systems poised for growth

Batteries connected to solar panels and storing electricity to power your home? Will this be the future of household electricity generation and supply? It may well be that this scenario becomes increasingly common in Australian homes in the coming years, with the idea of employing batteries to store electricity for household supply now gaining significant traction.

There are a number of companies operating in this space, and while it is an industry in its relative infancy, it also appears to be an industry poised for growth, with more and more consumers now thinking long-term when it comes to powering their homes.

Indeed, home battery systems, such as Tesla’s Powerwall, which can power homes using electricity generated from solar panels, are gaining increasing prominence in the market and are proving increasingly popular with consumers. The growth of the industry comes amid a period of rising electricity prices, developments in battery technology, and an increasing consumer focus on methods oriented towards “going off the grid”, to drive down electricity costs.

Australian Bureau of Statistics figures from around a year-and-a-half ago showed that around 14 per cent of households had solar panels for electricity generation, and the solar and battery storage industries are now well poised to further grow in conjunction with each other.

How does it work?

In very basic terms, home battery units connect to solar panels, with an inverter converting electricity, and the battery storing electricity generated during the day, which is then available to be used when needed, effectively allowing users to use more of the electricity generated by their panels.

There are a number of steps involved to get to this point, with different systems having different installation and maintenance requirements, with the method of installation dependent on the existing solar panels in place and the battery technology being used. Of course, solar panels and batteries can now be purchased together as a complete system, with this being an option for householders looking to completely overhaul their existing system or for consumers looking to set up a system in a new home.

The batteries themselves come in a range of sizes, and the ability of the battery to provide power for a house over a certain period of time will depend on both the size of the battery and the requirements of individual households.

Energy storage market set for growth

While home battery systems are not exactly a common fixture in Australian homes at present, this could change very quickly. In a market brief released earlier in the year, research firm IHS Technology found that the Australian energy storage market is set to grow from less than 500 installations at the end of 2015 to more than 5,000 systems this year, putting Australia in the top five markets for distributed energy storage in 2016, behind the US, Japan, Germany and the UK.

Looking further ahead, between 2016 and 2018, IHS Technology expects that behind-the-meter residential and commercial storage installations will double each year, with installations exceeding 200 MW of installed power capable of storing 250 MW hours of electricity, compared to less than 3 MW at the end of last year.

IHS expects that approximately 30,000 Australian households will have solar photovoltaic energy storage systems by 2018. In turn, IHS Technology notes that Australian growth is attracting major energy storage suppliers to the market, such as Tesla, which is looking to capture market share with its Powerwall home battery.

Tesla Powerwall

As noted by IHS Technology principal analyst Marianne Boust, Tesla has signed “several partnership agreements with well-known solar retailers and established utilities” in Australia.

Among its local partners, Tesla has teamed up with Origin Energy, with Origin having released its “Origin Solar + Powerwall” product, including solar PV panels (Trina panels), an inverter (SolarEdge) and the Powerwall.

As Telsa describes, the 6.4 KW/hour (KW/h) lithium ion Powerwall is a home battery that charges using electricity generated from solar panels, or when utility rates are low, and powers your home in the evening. A typical Powerwall system includes solar panels, an inverter for converting electricity between direct current and alternating current, a meter for measuring battery charge, and in back-up applications, a secondary circuit that powers key appliances. The Powerwall comes with a 10-year warranty.

Time to go off the grid?

Buying a home battery system such as the Tesla Powerwall is a major purchase to make, and while such systems will help save on electricity costs in the short-term, in terms of deriving value over the long term, it is very much a case of getting the economics right. In this regard, consumers will need to think long-term.

While Tesla is one of the bigger names in the market, it should also be noted that there are a number of other companies operating in the market, such as LG Chem, Panasonic and Sunverge Energy.

Australian battery company Redflow also recently unveiled its ZCell residential energy storage system, built around a zinc-bromine flow battery, the Redflow ZBM2, capable of storing 10 KWh of energy.

As for going off the grid, this will depend on individual households’ electricity usage, along with battery capacity and the capacity to generate electricity. Of course, consumers can install more than one battery, delivering greater storage capacity.

Amid rising electricity prices, and with the potential for the price of storage systems to drop in the short-to-medium term, home battery storage could prove to be an option worth investigating.

Consumers will need to do their research with regard to their individual situation, considering factors such as battery lifespan and replacement, and also talk to professionals within the field, before deciding on the best course of action.

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