As a follow up to our story on Wednesday on the potential of household adoption of battery storage – Morgan Stanley sees 2.4 million Australian homes with battery storage – we thought we would provide a few more graphs about how quickly that might be adopted.
This graph above shows the impact in terms of reduced demand from the grid, in various states, as households move to adopt battery storage.
Morgan Stanley says that it is not yet forecasting customer losses – as opposed to demand losses – for the utilities (e.g. from customers cutting off from the grid), but it does see lower gross margins per customer as energy usage per customer declines.
The cost, it notes, could be just below $400 a customer for Origin Energy and AGL Energy, as lower usage charges overwhelm gains from saved feed in tariff payments and energy costs. One key uncertainty in our earnings impact estimates is the impact of future network tariff increases and tariff structures.
As mentioned above, Morgan Stanley is discounting mass grid defections, at least with the Tesla PowerWall, because it would probably not be economic. Although it will feasible, and if it does happen, then it will happen first in Queensland because fewer batteries are needed.”
“Our channel checks think that mass grid shedding is unlikely to occur in the medium term, primarily because the solar and battery systems will not ensure the 99.9% availability of power currently provided by the grid,” the analysts write.
“Put simply, it’s thought that household solar and battery systems won’t have enough juice to make it all the way through the winter (especially in Victoria). Also, there are a large number of households with insufficient rooftop, capital or interest, e.g. apartment dwellers and renters.
“Looking at 10 years of consumption patterns from AEMO metering data and continuity of solar production from the Bureau of Meteorology, we conclude that cutting off will first be technically feasible in Queensland (e.g. 2x7kWh batteries paired with a 5kW solar PV system), followed by South Australia. Victorian consumers, with their cold, dark winters, may struggle to get there even with 3x7kWh batteries).