RenewEconomy
Since Tesla dropped the Powerwall, numerous claims have been made about what this means for households and the grid, ranging from ‘The Powerwall changes everything’ to why it’s ‘just another toy for Rich Greenies’.
In order to guide the economic discussion, I’ve created a simple calculator which allows people to investigate for themselves the household economic impact of solar plus batteries at Tesla prices!
To access calculator, click on this link. It will download to your laptop or computer. You will need Excel. Simple Solar plus battery economic calculator.
It’s free to download, use, and adapt for non-commercial purposes. Ensure you read the model limitations and assumptions before you begin, and interpret results accordingly. Example – A working household in Sydney
Here is a sample output for a household in Sydney with 12kWh daily consumption, who install a 4kW solar system with 7kWh Powerwall. They have a typical ‘working household’ load profile with some controlled daytime loads such as washing machine and dishwasher. The energy flows in the charts below are based on an average day – that is with average solar output and average electricity consumption.
Figure 1: Average day for 12kWh/day household, 4kW solar only, Sydney.
Figure 2. Average day for 12kWh household, 4kW Solar and 7kWh battery, Sydney Summary
The most notable impact is that the entire evening peak demand is covered by the battery. With solar and battery combination, the households source 92% of their energy from solar, versus just 36% with solar only. The day’s grid cost for this household is just 4c (excluding fixed costs) with solar and battery installed.
With the 7kWh battery pack installed, the householder pays the equivalent of 30c/kWh (levelised cost) for their solar and power, which for many households is at grid parity.
At current prices obtained from Solar City ($US7160 for the 10kWh fully installed), if it were a straight numbers race, the optimal decision for this household, if their flat electricity tariffs is 30c/kWh, is to:
1st – install Solar (16% decrease in annualised net energy cost compared to grid only),
Tied 2nd – Install Solar and battery (0% change in annualised net energy cost)
Tied 2nd – Use Grid power only What does this mean?
For many households, like the worked example above, installing ‘solar only’ is still the most economic option for household energy supply. At Tesla’s current pricing, ‘solar and battery’ is neck-and-neck with the grid in Australia. But it’s not a hard and fast rule – it depends on the discount rate, real-world variations in the household’s energy use and solar generation, plus a number of unknowns: such as the cost and terms of Tesla’s extended warranty, the efficiency degradation, and the maximum daily depth of discharge.
This simple analysis indicates that the Powerwall will not yet spur mass market uptake, but it is tantalisingly priced for attracting a raft of early adopters, particularly when factoring in the value of reduced grid dependence. If future electricity prices rise and Tesla’s prices reduce, the economic equation could clearly shift in favour of solar and batteries.
Note: this calculator is intentionally kept simple – please read the model limitations within the calculator for more detail before interpreting results. For precise economic analysis, the ATA is releasing an updated battery inclusive version of the ‘Sunulator’ later this year, which will conducts annual simulations for variation in sunshine and household demand. What does Tesla’s PowerWall do to your daily energy flows? Download the calculator to find out! Simple Solar plus battery economic calculator Chris Cooper is an energy analyst and President of Repower Shoalhaven, a community energy organisation who create renewable energy project for everyday people to invest in. This article was first published at RenewEconomy.
that is one well thought out calculator. great work Chris!
If you downloaded the calculator in the first five minutes of the story going live, please do so again as that version was an older version which has been updated with correct battery costs, which changes the economic substantially.
Just further on Chris' comment. The calculator you want is the one with the price at $6,640. Apologies for initially loading wrong one. Agghh!
The price is $5000 for a 9 year lease. Including inverter, installation, control system.
Do the calculation on that basis.
that would be $US5,000, for US consumers. So $A calculation is different.
So if you change the DoD assumption from 100% (which will destroy the batteries) to 70% (the usual assumption) solar plus batteries delivers negative benefits of $221/pa.
Hi Steve, there is growing consensus (amongst speculators mind you) that the 7kWh rated for daily use is a 10kWh pack, already derated and limited to 7kWh DoD. Time will reveal all!
Well a tear down will reveal all.
But will we be able to put it together again?
Don't let my dad undo the snap-fits, then we'll get it back together ;-)
That would be one way to do it, though I've seen the phrase "different chemistry" thrown about a few times. Probably all pure speculation at this point.
It does have a different chemistry. Look at the Wikipedia page.
Very interesting. Solar + battery and grid costs running neck-and-neck means the grid owners will need to start playing fair. This is fantastic news, and hopefully the grid owners will leverage their natural advantage and integrate dispersed renewables generation into the grid fairly, rather than continue to pursue their coal-age grid dominance model.
power wall $3000 US you still need an inverter, cheapest on the market is around $4,000 US wholesale, installation and margin you are looking at $10,000 US
Is an existing inverter such as SMA Sunny Boy 3000TL compatible with the Powerwall, or does it require a new inverter?
I have just heard the the Powerwall comes with a DC-DC inverter and is compatible for use with solar DC-AC inverters. What this means is that you don't need to buy another inverter if you have solar installed!
What would control the decision making about when to charge the batteries from solar, from the grid in ToU regions and discharge from the battery in that case?
I'm guessing there'd be a smart control unit which you could control with a phone app. Time will tell as we learn more about the product.
Hi Chris, what happens when the network company has to rebalance its tariffs to compensate for lost revenue in the hybrid scenario?
Hi Tosh! Provocative question which I'm sure networks are asking themselves as well. Shifting or raising tariffs will lead to a dynamic response from households which will worsen the situation for grids. I think networks need to start offering value to customers in different ways. They need to be a service provider not a capital builder. On top of the obvious solutions (i.e. solar and battery), one interesting idea is that they should offer virtual net metering arrangements thereby keeping people connected through grid facilitated energy trading.
Indeed. And they need to be able to do that all in a way that preserves the value of their capital asset while providing value for money to the customer. Ouch, something is going to give.
You're right. The regulator has to allow them to decouple their revenues from their capital base, otherwise they're stuck in a pickle.
So play this scenario out, say they have more flexibility in how they generate revenue. How does this solve the tension between current value of assets, and offering a competitive price to customers?
Write downs? Lower profits? They'll need to suck it up somewhere. Not familiar enough with the balance sheets of these network companies...perhaps we should ask Greg Garvin of Transgrid, he has got some ideas.
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that is one well thought out calculator. great work Chris!
If you downloaded the calculator in the first five minutes of the story going live, please do so again as that version was an older version which has been updated with correct battery costs, which changes the economic substantially.
Just further on Chris' comment. The calculator you want is the one with the price at $6,640. Apologies for initially loading wrong one. Agghh!
The price is $5000 for a 9 year lease. Including inverter, installation, control system.
Do the calculation on that basis.
that would be $US5,000, for US consumers. So $A calculation is different.
So if you change the DoD assumption from 100% (which will destroy the batteries) to 70% (the usual assumption) solar plus batteries delivers negative benefits of $221/pa.
Hi Steve, there is growing consensus (amongst speculators mind you) that the 7kWh rated for daily use is a 10kWh pack, already derated and limited to 7kWh DoD. Time will reveal all!
Well a tear down will reveal all.
But will we be able to put it together again?
Don't let my dad undo the snap-fits, then we'll get it back together ;-)
That would be one way to do it, though I've seen the phrase "different chemistry" thrown about a few times. Probably all pure speculation at this point.
It does have a different chemistry. Look at the Wikipedia page.
Very interesting. Solar + battery and grid costs running neck-and-neck means the grid owners will need to start playing fair. This is fantastic news, and hopefully the grid owners will leverage their natural advantage and integrate dispersed renewables generation into the grid fairly, rather than continue to pursue their coal-age grid dominance model.
power wall $3000 US you still need an inverter, cheapest on the market is around $4,000 US wholesale, installation and margin you are looking at $10,000 US
Ah, what to do?
http://reneweconomy.com.au/2014/battery-storage-costs-plunge-below100kwh-19365
Is an existing inverter such as SMA Sunny Boy 3000TL compatible with the Powerwall, or does it require a new inverter?
I have just heard the the Powerwall comes with a DC-DC inverter and is compatible for use with solar DC-AC inverters. What this means is that you don't need to buy another inverter if you have solar installed!
What would control the decision making about when to charge the batteries from solar, from the grid in ToU regions and discharge from the battery in that case?
I'm guessing there'd be a smart control unit which you could control with a phone app. Time will tell as we learn more about the product.
http://www.businessinsider.com.au/this-little-australian-startup-has-landed-an-agreement-with-tesla-to-support-its-new-home-batteries-2015-5
Hi Chris, what happens when the network company has to rebalance its tariffs to compensate for lost revenue in the hybrid scenario?
Hi Tosh! Provocative question which I'm sure networks are asking themselves as well. Shifting or raising tariffs will lead to a dynamic response from households which will worsen the situation for grids. I think networks need to start offering value to customers in different ways. They need to be a service provider not a capital builder. On top of the obvious solutions (i.e. solar and battery), one interesting idea is that they should offer virtual net metering arrangements thereby keeping people connected through grid facilitated energy trading.
Indeed. And they need to be able to do that all in a way that preserves the value of their capital asset while providing value for money to the customer. Ouch, something is going to give.
You're right. The regulator has to allow them to decouple their revenues from their capital base, otherwise they're stuck in a pickle.
So play this scenario out, say they have more flexibility in how they generate revenue. How does this solve the tension between current value of assets, and offering a competitive price to customers?
Write downs? Lower profits? They'll need to suck it up somewhere. Not familiar enough with the balance sheets of these network companies...perhaps we should ask Greg Garvin of Transgrid, he has got some ideas.