The battery storage industry with regards to solar power is still in the beginner, early adopter phases of development. Many people are skeptical about infrastructure growth, as well as material recycling issues that persist; but one thing is for certain, you can’t ignore it any longer. Battery storage IS the future, and it’s here to stay!
With the new peak hour rate shifts proposed by PG&E in 2019 to be implemented next year come January 2020 (you may not reside in California, but rate shifts are coming your way soon too), the only incentives the utilities offer are for solar PV + battery storage systems now. Excluding PV as a sole incentive program. That’s a BIG shift from a couple years ago, when all home owners who opted for solar PV would receive incentives annually. So we’re here to provide a little background on what’s out there as far as battery storage goes, as well as squashing some of the more outlandish rumors and myths.
Batteries
Almost 95% of the market is shared by two companies as of now for residential use only (industrial is a whole other warm of cans, along with flow batteries). LG and Tesla hold majority stake in the market today, splitting it almost exactly in half. LG chem battery is known to be a reliable option, although it has been scrutinized by engineers for overheating due to the completely sealed container it’s stored in. The Tesla Powerwall is an aesthetically pleasing battery pack, but has been known to be quite expensive (as everything Tesla makes seems to be).
Here’s some specs for both the LG Chem and Tesla Powerwall batteries:
Energy capacity cost is the cost of the energy components of the battery system (e.g. battery pack, etc).
The amount of energy that a battery can store is determined by its capacity [kWh] while the rate at which it charges or discharges is determined by its power rating [kW]. While PV system cost is typically estimated based on power rating [kW] alone, battery costs are estimated based on both capacity [kWh] and power [kW].
kWh = Energy Storage Capacity
kW = Power Rating (Charging/Discharging Rate)
The power components of the system (e.g., inverter, balance of system [BOS]) are captured by the power metric of $/kW and the energy components of the system (e.g., battery) are captured by the energy metric of $/kWh.
Power Components = $/kW
Energy Components = $/kWh
This allows the capacity (kWh) and power (kW) rating of the battery to be optimized individually for maximum economic performance based on the load and rate tariff characteristics of the site. Some systems are optimized to deliver high power capacity (kW), while others are optimized for longer discharges through more energy capacity (kWh).
So in a nutshell, it depends on the application of battery storage:
Do you have an EV charging station at your facility/home?
Do you want to have _____ hours of off-grid capability?
Do you plan to load shed during a power outtage?
Any other back up sources you plan to connect in series (diesel generator, etc)?
Myths
Myth #1: Wind and Solar are too unpredictable.
No way! With new innovations in the satellite technology industry, engineers can predict weather patterns for wind within a matter of days. Solar can easily be predicted using historical data trends given by NOAA.
Myth #2: Energy storage is expensive.
Yes, it used to be. But not anymore….We actually pay less for energy storage than one would pay for demand charges, interconnection, transmission and distribution network investments and operating costs charged by the utility companies. Battery cost has decreased significantly in the last decade and plans to decrease more as new innovations arise. A home system (Tesla Powerwall) can generally be considered to cost the customer $10k-15k total, with a simple payback around 10 years.
Myth #3: Energy storage can’t support baseload energy generation
Wrong! California alone has more renewable energy than we know what to do with. The problem is that baseloads + peak hours of energy use usually fall in the mornings and evenings. Energy produced that isn’t stored in a battery is lost, so by the time peak hours hit, the sun is down and therefore no solar power is being produced when the demand is the highest. So the only answer to that is BATTERY STORAGE! Charging the batteries throughout the day when energy use is low and solar radiation is high, and discharge in the evenings when use is high and radiation is low.
Myth #4: Batteries fade after too few charge cycles to be viable for grid-scale energy storage
Also false. Batteries these days (lithium) have become much more resilient and robust when it comes to degradation over long periods of time. If the owner monitors battery storage temperatures, degradation of your battery system shouldn’t be more than 0.5% per year, for a total of 15-20 years. This makes battery storage solution a viable option for longevity, energy peaks and valleys, tariff shifts and catastrophe relief avoidance.
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