Developments in residential energy storage (RES) are bringing integrated home energy management systems closer. It is no longer fanciful to imagine Australian families with a combination of rooftop solar, battery storage, electrical vehicles and an easy-to-use but sophisticated control system that coordinates the lot.
RES systems comprise a group of batteries with some high-tech software in a unit about the size of a household refrigerator. They can be programmed to take power from home-based renewable generation when the conditions are at their best (such as solar PV in the middle of the day) and/or from the grid when prices are low.
According to energy research specialist Energeia, thanks to advances in the off-grid market and the electric vehicle industry, the technology is already available. The principal constraint has been the relatively high cost, but that’s coming down. “The cost of lithium ion batteries is falling,” said Managing Director, Ezra Beeman. “Government programs, mainly in Germany and California, have lowered the cost of RES production. It will not be long before a RES system can compete with peak electricity prices.”
In its strategic research report, Game Changer: The Australian Residential Energy Storage Market to 2021, Energeia shows how RES will change the power game in every part of the power sector – conventional generation, electricity wholesaling and retailing, networks, and renewable energy.
For example, in New South Wales, where the changes to feed-in tariffs have altered the economics of exporting rooftop solar generation, excess power can be stored in a RES unit and used when peak grid prices are at their highest. Similarly, in Victoria, where the rollout of smart meters will widen the difference between peak prices and off-peak prices, RES can reduce energy costs with the added benefit of backup power.
“Backup supply, demand management and optimising solar PV are the most prospective market segments,” said Mr Beeman. “We forecast that, by 2021, some A$1.7 billion will have been invested in more than 400,000 units accounting for more than 4 GW of capacity and load. This will make RES a formidable force in the electricity industry.”
Energeia’s analysis shows that lead-acid will be the dominant technology for some time to come. “Lead-acid is going to be the low-cost option until electric vehicles are adopted more widely,” said Mr Beeman. “Lithium ion RES will take over then using recycled vehicle batteries. In the meantime, the supply chain for lead-acid batteries is in place and the units are 99% recyclable.”
On current trends, RES should be cost-competitive within five years. It is likely to complement rather than compete with other emerging technologies; however, it will shift the way electricity infrastructure is built and how wholesale energy is priced.
RES will change the power game forever.
Energeia is a Sydney based independent energy industry specialist providing research and advisory services to organisations focused on the natural gas and electricity industries.
P: +61 429 017 167