Know these things if you’re considering home battery storage
Energy storage technology has been around for decades, but solar batteries used in home solar-plus-storage systems are relatively new to the market. If you’re actively considering battery storage for your own house, we’ve compiled a list of 7 things that will put you well on your way towards making the right decision.
1. The best time to start looking into battery storage is NOW
Rooftop solar photovoltaic (PV – aka solar electric) technology has been mainstream for about a decade now, but grid-connected battery storage is still a relatively new idea. This means that battery products are not at the same stage of commercialization or mass adoption that solar panels & inverters are, and we’re still more or less in the ‘early adopter‘ stage.
The biggest hurdle that most people run into as they consider battery storage options is capital cost. The retail price for many battery products is larger than the cost of going solar (only) with the most popular system sizes (4kW, 5kW, 6kW), and adding batteries to a solar system can easily double the price.
But interest in energy storage is understandably high, with grid electricity prices through the roof in a nation (yes, Australia) where solar power is so common that one or several of your neighbors probably already have it – even if you don’t (yet). In these conditions, many people feel that battery storage is just another step towards energy independence.
Meanwhile, battery storage system prices are on their way down and more and more products are becoming available. Depending on what you pay for electricity and how you use it throughout the day, batteries could already be a viable option for you.
2. Having batteries doesn’t mean you’re off-grid
Make sure you’re not making the common mistake of getting your terminology mixed up: Just because your system has batteries doesn’t mean you’ll be ‘off the grid’ (or even have emergency backup functionality, for that matter).
Going forward, the vast majority of solar & battery systems will maintain a grid connection, as going off-grid requires lots of extra solar & battery capacity (which means substantially higher cost) to get your home through the worst weather days. Instead, most solar homes with batteries will be largely energy independent on a day-to-day basis, but will still rely on the grid to ‘fill in the gaps’ when their locally generated (and stored) energy falls short.
3. Most battery products out there have lithium chemistry
Lithium has quickly emerged as the battery chemistry type of choice for home energy storage. Lithium batteries are already in mass production for things like household electronics, electric vehicles, and various other applications, making them an obvious choice for companies looking to get into the quickly expanding energy storage space.
The only viable alternative that is similarly already in mass production is lead batteries, but because of their characteristics and specifications, lead batteries remain better suited for off-grid applications rather than grid-connected. A handful of companies have tried to introduce alternative batteries into space, but none have so far managed to find a way to compete with lithium on both performance and price.
4. Know the difference between ‘nominal capacity’ and ‘usable capacity’
Most batteries can’t actually fully discharge the energy that they hold without being damaged, so they’ve always got some kind of ‘in reserve’. This ‘reserve’ energy is actually no use to you; it may as well not be there because you can’t ever use it.
The capacity that includes this ‘untouchable’ energy is called ‘nominal capacity’ (given in kilowatts, kWh), while ‘usable capacity’ is the number that really matters.
5. Getting a system with a hybrid/battery-ready inverter tends to work out better financially
There are two main approaches to installing batteries alongside solar panels:
‘2 box solution’: Have an inverter for the solar panels and a separate (second) inverter/charger for the battery (sometimes built directly into the battery’s enclosure); or
‘1 box solution’: Have a single, hybrid/battery-ready inverter that handles both solar and batteries
By going with the second option, you’re cutting down on the number of components necessary for your system, which can (but doesn’t always) translate into a lower price tag.
6. Batteries tend to have shorter payback periods on ‘time of use’ tariffs
If you don’t know if you’re on a flat rate or a time of use (TOU) tariff, you should check your electricity bill or call your electricity retailer to find out. On a TOU tariff, you pay more for electricity during ‘peak’ hours and less during ‘shoulder’ and ‘off-peak’ hours. This price differential, coupled with the fact that most households use more energy during peak times (usually late afternoon & early evening), means that batteries tend to deliver bigger savings on TOU. If you do get batteries, consider switching to a TOU tariff (which may require some meter rejigging) if you’re not already on one.
7. There are other potential benefits to batteries than just solar charging
Charging your batteries with solar energy is the most basic (not to mention the most practical and financially important) way to use them. That being said, batteries offer a suite of other benefits to homeowners, including:
- ‘Tariff arbitrage‘ – On a TOU tariff, charging up batteries with cheap ‘off-peak’ electricity to discharge it later during peak times;
- ‘Selective energy export’ – Selling stored energy into the grid at a premium (see: Reposit’s GridCredits) during times of high demand;
- Emergency blackout backup power – Keep the lights on when even when the grid is down; attract the envy (or the ire) of neighbours sitting in the dark with no television; and
- Being part of the energy revolution – South Australia has recently introduced plans for a massive, distributed ‘virtual power plant’ comprised of small-scale solar & battery systems; there’s no doubt that battery storage is the (near-term) future.