>For the average U.S. home to rely solely on solar panels and Tesla's new batteries, the complete system would cost roughly $98,000, according to analysis by Bloomberg New Energy Finance. Even that glum assessment assumes a house in a sunny region such as Southern California.
Look at the link you posted. The recommended battery pack for that system is 62kWh (1284Ah * 48VDC). That is the equivalent of 6 10kWh Powerwall batteries.
Furthermore, the 10kWh Powerwall is not for solar or other daily applications; it's for backup.[1] A PV system needs to use the 7kWh batteries, thus requiring 9 for this system. That is $27,000 in batteries.
Now, on to the panels. The sizing of the system you posted indicates it assumes 5 Sun hours per day. Most of the US gets less than that; from the map on the site it looks like 4.3 is a good average for the US. Next, as the site clearly says when you run their off-grid calculator, you need to discount the Sun hours if you plan on using the system in the winter; they recommend knocking 1.5 off your yearly average. That drops most of the US to 2.8. That means the median house would need twice the number of solar panels in that set to cover all times of year.
Combined with the actual cost of Powerwall batteries, we are at $67,344. If you want to use the Pacific Northwest as your baseline (which someone opposed to solar would try to do) you approach the $98,000 for an off-grid system.
Something this article doesn't address is the potential impact batteries everywhere could have. This quote in particular tells me the author, and the speaker, don't see it this way:
“The battery-in-every-home idea—not only do I think it doesn’t make economic sense, I don’t think it’s necessary,” said Brian Warshay, an analyst at Bloomberg New Energy Finance. “Having a centralized grid is incredibly useful and incredibly efficient.”
The difficulty with our current power infrastructure is that there is no buffering at the consumption side. Because there is no buffering at the consumption side, the overall grid must be able to handle peak demand. That is, we must over-provision. With batteries everywhere, this isn't necessarily the case. In theory, we could all have generators, but we don't because they're noisy, smelly, and a maintenance hassle. But sticking a giant battery on the wall? I can see everyone having one, and big institutions having large arrays of them. I think that has the potential to fundamentally change our power grid.
Do you have any idea how many Li-Ion batteries would be needed to match the 30 GIGAWATT-hours of storage potential in the Bath County pumped storage plant?
The problem is that California didn't build enough of these 20 years ago. California has a couple of pumped-storage plants coming in... and as soon as they're built then net-metering will be even better for consumers.
In general, centralized storage at the utility-level will benefit from scale. Redox batteries will probably be cheaper and more efficient than Li-Ion batteries that Tesla is putting out.
And Pumped-Hydro is already much much cheaper, and has existed since the 60s.
The centralized grid is going to stay regardless of how many homeowners buy powerwalls; only so much can be buffered on the consumption side. Because another thing this article doesn't address is the fact residential power use occupies a mere 18% [1] of power consumption. Commercial is only 12%.[1]
Maybe you could store enough energy to run your datacenter overnight. I'm speculating, but powering a chip fab or even a machine shop on batteries seems infeasible.
But, I agree that there is a major imbalance and generation/storage on the consumption side would help correct that. Reduced need for peak generation --> greater net efficiency.
Batteries are also a form of over-provisioning, just a distributed one.
The real market potential for batteries is not in those parts of the West where there is cheap, reliable mains. It's those places where the grid is unreliable enough that people with money would buy generators, or places where the grid is a tiny island (Hawaii, Orkney).
"But sticking a giant battery on the wall? I can see everyone having one..."
High-rise office and apartment buildings probably don't have space to store all those batteries. If you have a suburban home with a garage you can hang a battery on the garage wall, but if you live in a 20-story apartment building, where would you put it? I doubt that fire codes would allow putting huge lithium batteries inside every apartment. A large fraction of the U.S. population lives in this kind of densely-packed urban environment.
This is the second article I've seen from Bloomberg that ignores two-thirds of what Tesla actually said and thus massively misses the point. I'm starting to think it's intentional.
No kidding this isn't (currently) attractive for North American homes. If I recall correctly, they basically said that in the press conference, though I can't find the link now. They were expecting it to be more useful in places with lots of solar and dodgy electric grids, such as Australia.
Bloomberg also goes on and on about utility scale storage. They apparently didn't read the press kit, where Tesla talked about how they're doing just that.
Long time ago I visited the home of a young entrepreneur that had spent all his money installing optical fiber all around his home.
I remember what I thought: How stupid someone could be. It does not make financial sense at all when it was so expensive.
Turn out I was the stupid one. This man created a company doing exactly what he had done in his house but for others and made a ton of money.
In some way he paid a cost for living in the future, and he understood the practical shortcomings and advantages of the new technology much better than anyone else, which made him succeed when others failed.
Net metering doesn't make sense. About half of the cost of residential electricity goes to running the grid.
That being said, electric companies aren't stupid. If / when solar power and batteries become ridiculously cheap, they will just switch over to solar and batteries.
Residential off-the-grid solar power will make sense in two markets:
- Highly rural areas where it's very expensive to maintain power lines.
- "Be prepared" cultures like Utah where people take pride in preparing themselves for Armageddon.
First, this is the opening price. The economics are going to get better from here, and the early adopters always pay a bit more for the privilege of experiencing the technology - and someone has to be first to get the ball rolling.
Next - If I have a $500K+ house (modest, by Northern California standards), and for $10K I could get this sleek, hi technology, 10 year warranty battery that lets me more efficiently leverage my solar panels, plus potentially giving me some insurance against a grid outage? Hell, I'm first in line.
Now, does the Tesla Battery make sense, for 100% of the US Population, today? Of course not - but I don't think anyone has suggested that.
But this is where we start, and we improve from here.
Except decentralized power are an expensive luxury product. If you build a 1GW pumped hydro plant with 10-hours of storage (10GW-hr plants cost roughly $3 Billion), then everyone benefits, including those in poverty who are unable to buy batteries for themselves.
Net-Metering from those who can afford rooftop panels can then store the energy centrally, and then offset the costs for the non-solar users in the rest of the neighborhood.
"So defection from the electrical grid will remain well out of reach for most Americans, and even those who manage the feat will waste a lot of capacity thanks to solar panels and batteries that are rarely used to their full potential."
Once again a news outlet (deliberately) fails to see the long-term strategy for the sake of a click-baity nay-saying headline. Just like the Tesla vehicle itself, which is still outside the reach of 99% of Americans, the point is to aim for the luxury market first and through scale and process optimization gradually lower the price so that it is within the reach of most Americans.
The luxury market is why Tesla is now able to develop a mass market vehicle, why solar panels are reaching an inflection point where in many parts of the world it will no longer make financial sense not to have them, and why home batteries will eventually be in the reach of everybody.
I love how the echo chamber keeps talking about the Powerwall as if it were the first battery system ever made.
You can buy batteries for your home, today, at a retail price half that of the Powerwall. With equal or greater energy storage, power output, and lifetime. There's no need to wait for Li-ion to become "within reach". It's a needlessly expensive technology and product attempting to displace cheaper, more capable solutions that have been available for years.
Their marketing sure is clever, though; they're already the only battery system that 98% of Americans have ever heard of! This is going to be a fascinating B-school case study in a year or two. It's one thing for Apple to convince people to pay a huge premium for its design, another entirely to convince people to pay twice as much for a noninteractive energy-storage device that sits in a basement or closet. I'm in awe. Luxury product indeed.
There are many many people who spend money right now on generators as emergency power sources.
My parents are a great example of a perfect use case for this product. They live in the country, and have 5-6 significant power outages a year, usually in winter. They need a way to automatically deliver power to critical house systems: furnace, well pump, fridge, freezer. Right now they use a large portable generator, but that requires maintenance and a manual engagement. You also cannot leave it unattended for long periods of time. That basically ties them to their house in the winter months, making vacations difficult.
Lots of other markets for this type of thing too. If you have a horse or hobby farm, one of these things keeps the heat on in the barn when the power goes out.
That is a great use of Tesla Powerwall that I didn't think of. Looks like most people are thinking Powerwall would be useful only in Sun drenched ares/season. But from your case, Powerwall would be very useful everywhere even in areas without much sun.
The article is much more negative than it should be. There is some truth in there, but the rest of it seems short-sighted. It's like saying "why in the world would anyone buy a $5,000 4k TV with an OLED screen?" Yet people buy them and that's how the technology becomes cheaper.
It's a little different with batteries because they don't improve at the same rate tech products do, but they still improve and I think once Tesla gets a couple of those Gigafactories going the batteries will become more appealing to a wider range of customers.
It's also the same with electric cars - 95% of the people still don't want one, even if they had the money for it, because they don't want the range anxiety. Also aren't solar panels still more expensive than buying coal-produced electricity? Or it least it was in the past few years, yet people still installed solar panels.
The bottom line is Tesla only needs some "early adopter" customers to hold it over until the product is cheap/good enough for the mainstream market. And by the looks of it, whether it's in electric cars, solar panels or batteries, that seems to have worked pretty well.
I don't understand why people feel the need to be an "early adopter" of something like this.
How many people out there want to be an early adopter of a Lennox Air Conditioning unit? Or of a New, more efficient furnace? Or more efficient windows?
The fact remains: the Tesla Powerwall is a "home appliance". The process for buying a new home appliance is the same as any other. You run the calculations, you determine if the appliance saves you money in the long term, and if it does... you go for it.
I seem to remember a lot of very similar articles arguing the economics of the iPhone didn't make any sense when it first arrived as well. Not trying to say the result here will be the same, just running hard numbers doesn't always tell the whole story.
The article omit use as alternative to UPS + diesel engine. In that use case it is competitive.
Moreover, any modern invention could be dismissed as toy/limited use for rich. E.g. Computers, mobile phones, cars... Next generation should be even more competitive.
Problem with Net Metering (at least for the people I know int he northeast who have solar) is that when the lights go out they are in the same boat as everyone else... where I live we have had multiple week+ outages. They, like everyone else, have to have a generator to keep things going (despite solar up on the roof). A battery would replace the generator and UPS in that case.
Of course, the week+ outage is usually due to ungodly amounts of snow... sooooo solar may not be your friend then...
Flywheel Disel Engines for example will automatically turn on when the power goes out... using a Flywheel to regulate the power the moment energy goes out... while simultaneously being the automatic-startup mechanism for the generator.
It's not like a flywheel + generator is very expensive. There's still a lot of innovation possible in the generator space.
I'm confused about why 'net metering exists' is a good argument against these batteries. As I understand it this is a mandated buy of excess home-generated solar at retail prices - is this correct? If so, does everyone really think this is sustainable if rooftop solar really takes off? Even if it technically is I expect to see widespread lobbying to end it (like in Hawaii) and expect most of the lobbying to succeed.
I don't think the Tesla batteries are a good way to lower your home energy costs, but I don't think I would factor in net metering as a reason why, at least not looking 5-10 years out.
If I recall correctly about 80% of Tesla's battery pre-orders by dollar value were in the commercial and utility categories rather than residential.
This article makes a big point that in the residential/solar panel market the battery is marginal at the moment in most of the US where grid electricity is cheap. Ok, but so what?
That statement is true as long as net metering is in effect. Net metering means you sell back to the grid for the same price as you buy from the grid. So you can treat the grid as a giant, perfectly efficient battery. Put $X of electricity in during the day and pull out $X at night. With a battery, you'd only be pulling out ~0.9X due to efficiency losses, not to mention the cost of the battery itself.
[+] [-] crdoconnor|11 years ago|reply
927 kwh / month off grid solar system : http://www.wholesalesolar.com/solarpowersystems/large-home-7...
Cost : $20,172
Two of Elon's batteries: $7k
Total cost = $27,172
How the hell did they get $98k?
I think they intentionally tried to make that number look ridiculous. I wonder if this is more of ALEC's anti-solar bullshit.
[+] [-] vonmoltke|11 years ago|reply
Furthermore, the 10kWh Powerwall is not for solar or other daily applications; it's for backup.[1] A PV system needs to use the 7kWh batteries, thus requiring 9 for this system. That is $27,000 in batteries.
Now, on to the panels. The sizing of the system you posted indicates it assumes 5 Sun hours per day. Most of the US gets less than that; from the map on the site it looks like 4.3 is a good average for the US. Next, as the site clearly says when you run their off-grid calculator, you need to discount the Sun hours if you plan on using the system in the winter; they recommend knocking 1.5 off your yearly average. That drops most of the US to 2.8. That means the median house would need twice the number of solar panels in that set to cover all times of year.
Combined with the actual cost of Powerwall batteries, we are at $67,344. If you want to use the Pacific Northwest as your baseline (which someone opposed to solar would try to do) you approach the $98,000 for an off-grid system.
[1] http://www.teslamotors.com/powerwall
[+] [-] alexggordon|11 years ago|reply
[0] http://energy.gov/savings/residential-renewable-energy-tax-c...
[+] [-] scott_s|11 years ago|reply
“The battery-in-every-home idea—not only do I think it doesn’t make economic sense, I don’t think it’s necessary,” said Brian Warshay, an analyst at Bloomberg New Energy Finance. “Having a centralized grid is incredibly useful and incredibly efficient.”
The difficulty with our current power infrastructure is that there is no buffering at the consumption side. Because there is no buffering at the consumption side, the overall grid must be able to handle peak demand. That is, we must over-provision. With batteries everywhere, this isn't necessarily the case. In theory, we could all have generators, but we don't because they're noisy, smelly, and a maintenance hassle. But sticking a giant battery on the wall? I can see everyone having one, and big institutions having large arrays of them. I think that has the potential to fundamentally change our power grid.
[+] [-] dragontamer|11 years ago|reply
https://en.wikipedia.org/wiki/Bath_County_Pumped_Storage_Sta...
Do you have any idea how many Li-Ion batteries would be needed to match the 30 GIGAWATT-hours of storage potential in the Bath County pumped storage plant?
The problem is that California didn't build enough of these 20 years ago. California has a couple of pumped-storage plants coming in... and as soon as they're built then net-metering will be even better for consumers.
In general, centralized storage at the utility-level will benefit from scale. Redox batteries will probably be cheaper and more efficient than Li-Ion batteries that Tesla is putting out.
And Pumped-Hydro is already much much cheaper, and has existed since the 60s.
[+] [-] sjbase|11 years ago|reply
Maybe you could store enough energy to run your datacenter overnight. I'm speculating, but powering a chip fab or even a machine shop on batteries seems infeasible.
But, I agree that there is a major imbalance and generation/storage on the consumption side would help correct that. Reduced need for peak generation --> greater net efficiency.
[1]: http://www.eia.gov/tools/faqs/faq.cfm?id=447&t=1
[+] [-] Spooky23|11 years ago|reply
[+] [-] pjc50|11 years ago|reply
The real market potential for batteries is not in those parts of the West where there is cheap, reliable mains. It's those places where the grid is unreliable enough that people with money would buy generators, or places where the grid is a tiny island (Hawaii, Orkney).
[+] [-] greenyoda|11 years ago|reply
High-rise office and apartment buildings probably don't have space to store all those batteries. If you have a suburban home with a garage you can hang a battery on the garage wall, but if you live in a 20-story apartment building, where would you put it? I doubt that fire codes would allow putting huge lithium batteries inside every apartment. A large fraction of the U.S. population lives in this kind of densely-packed urban environment.
[+] [-] breischl|11 years ago|reply
No kidding this isn't (currently) attractive for North American homes. If I recall correctly, they basically said that in the press conference, though I can't find the link now. They were expecting it to be more useful in places with lots of solar and dodgy electric grids, such as Australia.
Bloomberg also goes on and on about utility scale storage. They apparently didn't read the press kit, where Tesla talked about how they're doing just that.
Press Kit - http://www.teslamotors.com/presskit
[+] [-] dba7dba|11 years ago|reply
It IS intentional. Pretty much everything said (and NOT said) on MSM is intentional.
[+] [-] Htsthbjig|11 years ago|reply
I remember what I thought: How stupid someone could be. It does not make financial sense at all when it was so expensive.
Turn out I was the stupid one. This man created a company doing exactly what he had done in his house but for others and made a ton of money.
In some way he paid a cost for living in the future, and he understood the practical shortcomings and advantages of the new technology much better than anyone else, which made him succeed when others failed.
[+] [-] gwbas1c|11 years ago|reply
That being said, electric companies aren't stupid. If / when solar power and batteries become ridiculously cheap, they will just switch over to solar and batteries.
Residential off-the-grid solar power will make sense in two markets: - Highly rural areas where it's very expensive to maintain power lines. - "Be prepared" cultures like Utah where people take pride in preparing themselves for Armageddon.
[+] [-] hliyan|11 years ago|reply
[1] http://www.greentechmedia.com/articles/read/1.2-Trillion-Met...
[2] http://data.worldbank.org/indicator/EG.ELC.LOSS.ZS
[+] [-] ghshephard|11 years ago|reply
Next - If I have a $500K+ house (modest, by Northern California standards), and for $10K I could get this sleek, hi technology, 10 year warranty battery that lets me more efficiently leverage my solar panels, plus potentially giving me some insurance against a grid outage? Hell, I'm first in line.
Now, does the Tesla Battery make sense, for 100% of the US Population, today? Of course not - but I don't think anyone has suggested that.
But this is where we start, and we improve from here.
[+] [-] dragontamer|11 years ago|reply
Net-Metering from those who can afford rooftop panels can then store the energy centrally, and then offset the costs for the non-solar users in the rest of the neighborhood.
[+] [-] Aqueous|11 years ago|reply
Once again a news outlet (deliberately) fails to see the long-term strategy for the sake of a click-baity nay-saying headline. Just like the Tesla vehicle itself, which is still outside the reach of 99% of Americans, the point is to aim for the luxury market first and through scale and process optimization gradually lower the price so that it is within the reach of most Americans.
The luxury market is why Tesla is now able to develop a mass market vehicle, why solar panels are reaching an inflection point where in many parts of the world it will no longer make financial sense not to have them, and why home batteries will eventually be in the reach of everybody.
[+] [-] fredkbloggs|11 years ago|reply
You can buy batteries for your home, today, at a retail price half that of the Powerwall. With equal or greater energy storage, power output, and lifetime. There's no need to wait for Li-ion to become "within reach". It's a needlessly expensive technology and product attempting to displace cheaper, more capable solutions that have been available for years.
Their marketing sure is clever, though; they're already the only battery system that 98% of Americans have ever heard of! This is going to be a fascinating B-school case study in a year or two. It's one thing for Apple to convince people to pay a huge premium for its design, another entirely to convince people to pay twice as much for a noninteractive energy-storage device that sits in a basement or closet. I'm in awe. Luxury product indeed.
[+] [-] Spooky23|11 years ago|reply
There are many many people who spend money right now on generators as emergency power sources.
My parents are a great example of a perfect use case for this product. They live in the country, and have 5-6 significant power outages a year, usually in winter. They need a way to automatically deliver power to critical house systems: furnace, well pump, fridge, freezer. Right now they use a large portable generator, but that requires maintenance and a manual engagement. You also cannot leave it unattended for long periods of time. That basically ties them to their house in the winter months, making vacations difficult.
Lots of other markets for this type of thing too. If you have a horse or hobby farm, one of these things keeps the heat on in the barn when the power goes out.
[+] [-] dba7dba|11 years ago|reply
[+] [-] higherpurpose|11 years ago|reply
It's a little different with batteries because they don't improve at the same rate tech products do, but they still improve and I think once Tesla gets a couple of those Gigafactories going the batteries will become more appealing to a wider range of customers.
It's also the same with electric cars - 95% of the people still don't want one, even if they had the money for it, because they don't want the range anxiety. Also aren't solar panels still more expensive than buying coal-produced electricity? Or it least it was in the past few years, yet people still installed solar panels.
The bottom line is Tesla only needs some "early adopter" customers to hold it over until the product is cheap/good enough for the mainstream market. And by the looks of it, whether it's in electric cars, solar panels or batteries, that seems to have worked pretty well.
[+] [-] dragontamer|11 years ago|reply
How many people out there want to be an early adopter of a Lennox Air Conditioning unit? Or of a New, more efficient furnace? Or more efficient windows?
The fact remains: the Tesla Powerwall is a "home appliance". The process for buying a new home appliance is the same as any other. You run the calculations, you determine if the appliance saves you money in the long term, and if it does... you go for it.
[+] [-] bsbechtel|11 years ago|reply
[+] [-] jakozaur|11 years ago|reply
Moreover, any modern invention could be dismissed as toy/limited use for rich. E.g. Computers, mobile phones, cars... Next generation should be even more competitive.
[+] [-] hoopism|11 years ago|reply
Of course, the week+ outage is usually due to ungodly amounts of snow... sooooo solar may not be your friend then...
[+] [-] dragontamer|11 years ago|reply
Flywheel Disel Engines for example will automatically turn on when the power goes out... using a Flywheel to regulate the power the moment energy goes out... while simultaneously being the automatic-startup mechanism for the generator.
It's not like a flywheel + generator is very expensive. There's still a lot of innovation possible in the generator space.
[+] [-] gnoway|11 years ago|reply
I don't think the Tesla batteries are a good way to lower your home energy costs, but I don't think I would factor in net metering as a reason why, at least not looking 5-10 years out.
[+] [-] sunstone|11 years ago|reply
This article makes a big point that in the residential/solar panel market the battery is marginal at the moment in most of the US where grid electricity is cheap. Ok, but so what?
[+] [-] dba7dba|11 years ago|reply
1. No kids would be born. They do not make financial sense at all.
2. We all would be living in some nasty environment. Caring for the environment doesn't make much sense for companies.
3. Caring weak, vulnerable people doesn't make any financial sense at all.
[+] [-] andrewtbham|11 years ago|reply
that seems like it can't possibly be true.
[+] [-] bryanlarsen|11 years ago|reply