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Australian battery price war resumes, with Powerwall 2 delivery just ‘weeks away’

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One Step Off The Grid

As 2017 ticks over into its second month, Australian solar and battery installers are predicting a “very, very exciting year” as the home energy storage market shifts from early adopter, to “early majority”.

Driving this shift is the sensational downward price trajectory of home battery systems, which in little more than a year has seen them go from an “emotional investment” to an economic no-brainer.

This price drop, while mostly driven by economies of scale in manufacturing – which have, in turn, been buoyed by ripe markets like Australia with high electricity prices, abundant solar rooftops and disappearing solar bonus schemes – has also been boosted by a healthy rivalry between market leaders like LG Chem and Tesla.

tesla-powerwall-2

Tesla, whose Powerwall 2 battery is reportedly due to hit Australian shores in a matter of weeks, and almost certainly in the first quarter of 2017 according to one industry source, has been a major pace setter on pricing, having essentially doubled he capacity of its home battery offering, while halving its price per kilowatt-hour, and reducing its physical size by one-third – all in less than 12 months.

The US EV maker has two Powerwall 2 energy storage units on offer to Australian residential customers: both 14kWh; one an AC version and one a DC, fully integrated model that can work in island mode, continuing to deliver stored solar energy to the home if the grid goes down.

According to Chris Williams of Natural Solar – a certified Australian Tesla reseller – adding a Powerwall to an existing solar system will cost around $10,000, while the DC fully integrated system starts at $15,000 with solar panels included.

LG Chem, meanwhile, is keeping up appearances as the Australian distributed battery market leader with deals surfacing that offer its 6.4kWh battery plus inverter and energy monitoring system for just under $5,900.

That’s a pretty impressive discount on prices from as recently as April last year, when the LG Chem Resu 6.4EX battery alone retailed for $7,500. And a pretty good option for those tens of thousands of existing solar homes coming off the premium feed-in tariff.

As we reported in November 2016, South Korea’s LG Chem also offers Australian households a 9.8kWh lithium-ion battery, available in Australia since December 2016, in a joint deal with SMA that includes SMA’s Sunny Boy Storage 2.5 battery inverter.

And of course, there is plenty of other competition in the market, including from Enphase, Sonnenbatterie and Redflow, to name but a few. Most recently, German company Senec-IES added its name to the mix, with its first shipment of HOME Li Home Energy Storage Systems arriving in Australia last week.

But as Natural Solar’s Wililams told One Step Off The Grid in an interview on Tuesday, it’s not just the battery prices and product offerings that are evolving so rapidly, but the market itself.

“This year is going to be really, really exciting,” Williams said. “What we’ve identified is that the market has really adjusted from an early adopter market to an early majority market, a mum and dad market, it’s a different target market now.

“The pricing per kWh around the market certainly has come down, but at the same time we’ve seen the price of electricity go up and customers come off premium tariff schemes. So the value proposition for batteries has changed.”

Williams says that for his company, Tesla’s Powerwall is leading the pack in terms of customer inquiries, with the first shipment of its 14kWh Powerwall 2 units expected to arrive sometime in Q1, and possibly within the next few weeks.

“I can tell you that the pre-orders for the Powerwall 2 are currently at more than three times the pre-orders we got for the Powerwall 1, at the same stage of delivery.”

As well as being double the capacity, the Powerwall 2 is also 30 per cent smaller in size, he says, making it more attractive to home owners at the same time as they become more familiar with the product and more confident about investing in it.

But the bottom line, says Williams, and the most exciting market development of all, is that “it now makes financial sense to get a home energy system.

“Now, customers who do the sums and work out the return on investment… go ahead based on financials.”


This article was originally published on RE sister site One Step Off The Grid. To sign up for the weekly newsletter, click here.  

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  • trackdaze

    Rip coal.

    • John Norris

      RIP

    • FIFO69

      Lol

  • solarguy

    Sophie, I think you will find that LG & Inverter offer is wholesale and will retail for more, plus installation.

    • Daryl Raverty

      Yes, I am an installer, that price is wholesale plus GST plus installation.

  • Jason Van Der Velden

    The government continues to do everything to push people to batteries and solar cv panels.

    • Chris Marshalk

      PHWOARRRRrrrrr —- “I can tell you that the pre-orders for the Powerwall 2 are currently at more than three times the pre-orders we got for the Powerwall 1”.

  • George Darroch

    If I was in the market (ie, owned my own home), I’d definitely be looking at the Powerwall ahead of the others. They’ll have to bring their prices down to compete, or lose the lion’s share of the market.

  • Ian

    The smart politician would throw some money subsidising storage, if, as Sophie says, battery storage is becoming economically viable, then a small subsidy sweetener from the government could put the uptake of home battery storage into second gear.

    Solar is predictable, in the sense that power is produced in a nice bell-shaped curve through the day, if enough of it is installed, then base-loading coal will be out-competed by solar in the middle of the day. Wind has its own generation profile, its FF nemesis is gas power generation , the which is not so dispatchable as most would like. – A very real competition between the old and the new. Battery storage, however, is the quintessential mediatory technology bringing these competing generation types together and/or solving the intermittency problem.

    Any wise FF generator incumbent , and thus (in-their-pocket) politician should see that batteries are good for humanity.

    With one government budget item ( home battery subsidy) several objectives can be achieved:
    1. Voter support could be gained – nothin’ like a freebie to reel in the votes!
    2. Distributed rooftop solar energy could be kept in the home and used domestically , this should appease the FF generator hornets nest, who have been riled by the export of home solar into their grid.
    3. Battery and other storage is needed for grid reliability, for a small investment in public funds a large investment of individual’s money can be leveraged to build out grid connected storage.
    4. Battery storage,if managed correctly, could end the punitive tariff structures that have alienated so many electricity customers.
    5. Battery storage is expected to reduce in cost over time, a small subsidy may kickstart the installation industry creating badly-needed jobs, so that when batteries are very keenly priced, the industry is already well acquainted with this technology and up-and-running to take full advantage.
    6. Solar battery storage goes hand in hand with electric vehicles, one: by encouraging the manufacture of the little lithium cells that go into both types of devices and two: by providing a buffer and a portal ( V2G -G2V ) for energy transfer from electricity grid to transportation and vice versa – another potentially yuge battery storage resource, and a very nice new market for the remaining FF generators to extend their useful life.

    • Bristolboy

      Interesting that the UK government are targetting subsidy of battery technologies as the future despite blocking solar and onshore wind!

    • Greg Hudson

      Adelaide is already offering a AU$5k subsidy. However, I personally don’t believe subsidies are required. All facets of businesses should be subsidy free in particular the FF industry, Alcoa, car manufacturers etc etc.

    • Brunel

      What about housing the homeless?

      Giving batteries to people that already have houses while not giving shelter to homeless is unfair.

      • Brad

        Maybe since people who work and own their own home are the ones take already pay most of the tax and could get a little bit of it back

        • Brunel

          Wow. Because who cares about the homeless.

          • Brad

            Cause that means I dont care? but you could say that about every tax dollar spent. Why spend money on education when there are people in hospital or why spend defense money rathers than dole money. there has to be something in there for grinders who go to work every day

          • Brunel

            Ah, you vote for the LNP.

            Explains your stance on the homeless.

          • Colin

            That was weird, Brunel.

      • Ian

        Australian society is extremely conscious of people in need and the government budget already deals with issues such as homelessness, unemployment, child safety, care and support of the elderly, mental health and substance abuse etc etc. your not suggesting that we as a country are shirking on these social duties are you? Surely you would recognise that some government support should go to other concerns like environment, human development, infrastructure , organised medical care . Incentivising battery storage to enable the development of a mature supply chain and industry is not unreasonable. Using a small sum of tax money to leaverage a large private investment in battery storage is very smart. Keeping infrastructure in the hands of Australians and ordinary people instead of some foreign multinational is in the true labor spirit. The tall poppyism you are promoting has already weakened the Australian People and resulted in a loss of ownership of our own industry and means of production to foreigners. Pulling out that old pherpie ” what about the poor” whenever any suggestion of empowering the vigorous of this country is pathetic.

  • FIFO69

    This article is misleading. There are no numbers in it to backup the claims that “it is an economical no-brainer” and “it now makes financial sense to get a home energy system”.

    It may pay for itself after 10 years under limited circumstances.

    See some actual numbers here:
    https://www.solarquotes.com.au/blog/tesla-powerwall-2/

    • trackdaze

      This is another that suggest price competitive with current grid pricing.

      http://reneweconomy.com.au/teslas-price-shock-solar-battery-as-cheap-as-grid-power-22265/

      • FIFO69

        That one provides a bit more detail thanks for that.

        It says an outlay of $16k is required for the system and talks about achieving something similar to cost of power from the grid.

        Quote “A typical household in the suburbs of Adelaide can now meet its electrical needs with solar and battery storage for about the same amount they would pay on a competitive offer from the grid.”

        Wow what a great technology! Outlay $16,000 to get power prices equivalent to power from the grid..

        Looking at the graph you might save $100 or $150 a year at a stretch.

        I’m certainly not going to rush out and outlay $16,000 for a system with a payback period of 106 years.

        • Ren Stimpy

          Get real. The payback is achieved with the reduction in the variable charge (the difference between the green bar on the right and the green bar on the left), plus the income derived from export (red bar on the left).

          It would help to see the numbers of course but going by the chart alone it looks like payback is occurring at $1550 per year – $1300 in reduced variable grid charge plus $250 for grid exports.

          So the payback period is about 10 years. But who cares! because there is a $400 cost saving per year ($150 usage saving plus $250 in exports). Who doesn’t want a $400 cost saving per year! It makes financial sense to do this now.

          The price of batteries and solar panels is also plummeting, and the variable cost of power from the grid is skyrocketing, so it will make more and more sense each and every year from now on.

          • FIFO69

            Get real? Don’t worry about me son, I’m as real as it gets!

            Ok, so you say the export back to the grid value looks like about $250 per year and the savings looks like about $150 per year. A total benefit of $400 per year. Lets assume for a second that the author is not fudging the numbers and take them on face value.

            Payback period on a $16,000 system is therefore 40 years! Due to deterioration in the batteries and solar cells their efficiency would reduce over time and further impact on the return so lets push the payback period out to 45 years.

            I doubt I will be living in my current house in 45 years to enable the full capture of the benefits from this great cutting edge technology.

            I could put that potential $450 a year savings into a savings account @ 3% interest I will have $42,000 after 45 years (vs an electricity bill saving of about $18,000).

            ie: I could double my benefit by doing nothing.

          • Ren Stimpy

            Sorry son, but you are either a stick in the mud or an idiot. Or both.

            But I like your spirit, and I hope that at least you have some basis of belief behind your young unmathematical incoherant ramblings.

          • FIFO69

            Can you point out the mistake in my “unmathematical incoherant ramblings”?

            $16,000 capital outlay/$400 savings per yr = 40 year payback period.

            Pretty basic stuff..

          • Ren Stimpy

            Scroll up and read my comment covering “reduction in the variable charge”

            Apologies to all, I had wondered if this guy was a stick in the mud but it turns out he’s just an idiot.

          • Rod

            Going by his handle he has some skin in the FF game.
            All I can say to sceptics is stick some PV on your roof and come and tell me in a year or so that you made a mistake.
            Add Solar HWS and a few efficiency improvements and grid free becomes a very real and valuable investment

          • FIFO69

            I prefer to do the sums first and calculate the return on investment and then compare between alternative opportunities..

          • Ren Stimpy

            Obviously with a closed mind – always (without fail) detrimental to profits.

          • FIFO69

            What are you trying to say? You really need to put down the bong mate.

          • Ren Stimpy

            Maybe, and you really need to pick up a maths textbook mate.

            Look I don’t want to put your generation down, but if you want to argue the toss with us Gen Xers’ or Boomers, then first do some maths or physics study. I mean just scroll up matey to see you your very real mathematical deficiencies. Maybe put down the smart phone with the Instagram and the HooKnozwot or Whateva app, and just focus on the data. Just the data, son.

          • FIFO69

            I’m 38 with an engineering ug qual and gcert mining engineering mate.

            I noticed you haven’t pointed out any miscalculations.

            Maybe you can give back to uni and upgrade your arts degree.

          • Ren Stimpy

            What about your miscalculation I pointed out to you in my first reply to you? You said “106 years”, I correctly said 10 years.

            You were wrong by an order of magnitude.

            I guess as an engineer you know what an order of magnitude is?

            Is anyone looking to hire you, because I would advise them not to.

          • FIFO69

            Im not looking for a job. I am happy in my current position thanks.

            Can you justify your statement that the system will generate $1550 per year return?

          • Ren Stimpy

            Thank fuck.

          • FIFO69

            I guess you can’t justify that number.

            Good luck on the dole.

          • Ren Stimpy

            You dumb idiot. But I still like you, hey it’s a trait of us older people we like to see people like you having a go, having a dig, even if they are completely misguided.

          • FIFO69
          • Ren Stimpy

            What? “Japan has ratified the Paris Climate Agreement and committed to a 26 per cent reduction in carbon dioxide emissions by 2030.” Is that news?

          • FIFO69

            That’s right, and doing it by building 45 new coal fired power stations and burning high-quality coal. You know like Australia exports.

            Makes you wonder why they don’t just put that money into tesla batteries and rooftop solar if the economics are so great.

          • Ren Stimpy

            “high quality coal”, you’re joking right? What are the emissions per tonne in even the cleanest of coal when it is burned? Between 98 and 110 tones of CO2.

            https://theconversation.com/infographic-the-state-of-coal-60545/

            There is no such thing as high quality coal. But I guess you an engineer would know that already after doing his research? Oh sorry an unemployed engineer.

          • FIFO69

            K, we will see in 6 months. My mate turnbull-talks-up-coal-as-part-of-energy-mix getting fired up….

          • Ren Stimpy

            Does that mean he’s “putting it on the table”? It’s a good sign that it will never happen then. It’s one thing to talk a big game, being a politician that’s what he does for a living, but sooner or later we will have to see some plans and numbers – timelines and costs, and that’s when things will start to get interesting.

          • Rod

            So, that $15K that you consider a waste on PV and a battery you will be able to invest in shares in a Super Dooper Ultra Hypocritical power station. Good luck with that.

          • Rod

            Are you saying you don’t see the value in PV?
            How do you calculate shading benefits?
            How do you calculate likely behavior changes due to installing PV/storage and the associated metering.?
            How do you know what energy and usage costs will be in future?
            Many of these batteries have a 10 year warranty but will still be fine for probably 20 years

            If my pic uploaded, this is my energy credit from a 17 year old 2.4kwhp system. Might not have made much $ense back then but it has well and truly paid for itself and all just gravy from here on.
            https://uploads.disquscdn.com/images/f106c9f19a4ee27bbe8b4236a4ea3b6415e26784c8f8e8ba3341a76163c9d2da.png

          • Ren Stimpy

            No don’t reply with numbers to this uneducated idiot. Deaf ears / monkey instincts and all that.

          • Rod

            I’m like a religious nutter when it comes to RE
            I think anyone can be converted if they give it a chance.

          • FIFO69

            I’m not going to base my assessment on your situation. You might live alone in a shack with a 10kw system, no hot water, oven or air conditioning.

            https://www.solarquotes.com.au/blog/tesla-powerwall-2/

          • Rod

            I asked 4 questions and not one answer. How rude!
            Just in case there is any one reading this who hasn’t got his head in the sand or up his arse. 3 adults, SHWS, benchtop oven, and a solar oven, reverse cycle AC (used occasionally due to energy efficient home improvements)
            Your average household electricity bill is what, 2k a year so I figure I’m 3k ahead every year of your average muppet.
            I would have storage tomorrow if I wasn’t on a premium FiT
            You can try to kid yourself that this isn’t happening but the stars are aligned perfectly for storage and the rate of uptake will astound everyone.

          • solarguy

            Yep Ren & Rod are right, you can’t blink and breath at the same time, can ya!

          • FIFO69

            No need to get personal just because i pointed out what a terrible investment this is..

          • solarguy

            My pleasure mate. You would be wise to invest in the truth, instead of trying to tell us black is white.

          • FIFO69

            Terrible investment son

          • solarguy

            Jesus Christ, do you feel embarrassed when you look in the mirror, because you should if you don’t. Did the doctor drop you on your head when you were born or slap it instead of your arse.

            I won’t engage further with fools like yourself.

          • FIFO69

            Don’t blame me for your terrible investment decisions

          • Ren Stimpy

            Yeah sore that the Galilee Basin project didn’t go ahead.

            Get over it son.

          • FIFO69
          • Daryl Raverty

            Dead right.

          • FIFO69

            My comments and numbers are valid.

            Instead of paying off electricity bill to the retailer you are paying off a PV/Battery system for no gain.

            At the end of the payback period you get a 40 year old piece of redundant technology.

          • Ren Stimpy

            Your comments and numbers are crud.

            “Instead of paying off electricity bill to the retailer you are paying off a PV/Battery system for no gain” – no it is at a faster and finalising rate than the never-ending rate that the fossil fuel industry currently demands with their rorting electricity charges.

            Pushing this shit destroys your credibility matey, but as an amateur fossil fuel industry spruiker who never took a math class, have you elevated your level of knowledge, no, is the answer, son.

          • FIFO69

            So you are saying it is a good investment based on your ideology rather than the results of a simple payback period calculations?

            If I put that $16k into my home loan I would save more in interest than the savings this would generate.

          • Martin Sevior

            Hi FiFO69,
            Actually the calculation had an interest rate charge in it:

            “Putting this together and annuitising the capital items at 2 per cent real (the typical mortgage rate)”

            So the $400 per year saving included a 2% borrowing charge against the 16K$.

            Actually one could also make the investment as a backup against grid failure and a hedge against rising grid prices. Both of which on on the cards as we move to large scale coal-plant closures.

  • Rob

    King Coal is dead. Long live Queen Renewables.!

  • Rob

    The business model for energy utilities just died! The next step will be to go off grid completely.

    • David Pethick

      “The next step will be to go off grid completely”.

      Grattan Institute did some modelling that is interesting. To achieve grid disconnection with a similar level of reliability to South Australia in 2016 (at least 99%) would require a 10kW solar system at 60 kWh of storage. Based on the figures above, that would cost about $60k upfront and last for about a decade. By comparison, grid power will cost the same sized household about $15-20k in Net Present Value terms.

      In reality – few houses have enough roof space for 10kW of solar and few families have a spare $60k lying around. We’re a long way away from the great grid disconnect…

      Cheers.

      Dave P.

      • Mike Dill

        I love the hype from sources like that.

        Buy the 10kW of solar panels. If you do not have the space, the newer high efficiency modules (22% efficient) take up less space on the roof. That will be about $10k, and reduce your electric bill by at least that amount over the next 10 years.

        If you can afford it, add a 10 to 20kWh battery, for $10k to $20K. The payback will be anywhere from six to twenty years at the current prices.

        If you still want to go off-grid, you install a 4kW generator with the system shown above. The corner case for the extra 40kWh of storage, is for the 10 days a year when the sun does not shine for more than a day. While a generator sounds like a poor choice, it and the fuel will be about $1k over five years.

        In five to ten years the price of storage will come down to about half the current price, and you can add more storage as you can afford it, continuing to reduce your dependence of fossil fuels.

        • David Pethick

          Hi Mike

          I like the idea of a diesel generator as the backup for a smaller battery. I hadn’t considered it previously. Large solar + battery + diesel is a more reasonable comparison to grid-supplied energy, with the same degree of reliability.

          That said – I think the distribution grid will still be a core part of our electricity supply technology stack in two or three decades from now. I can’t see too many people choosing to cut the cord.

          Cheers.

          Dave P.

          • Mike Dill

            I live in the suburbs, and until three years ago I never even thought about going off-grid. With the dropping prices for solar and storage, I expect that self-generation and storage will be at parity with grid power even in the continental USA ($0.12/kWh) in five to seven years.

            So, at that time, should I remain connected, for insurance, for about $30/month? or should I use that to make my life more resilient in other ways?

          • Rod

            Spot on. I’m not sure what the Grattan Institute considers an average home but with solar hot water and a bit of work on energy efficiency I’m sure many in temperate Adelaide could easily go off grid with a 10KWh battery and as you say, a generator for desperate times.
            I’m not sure if your neighbours would be happy with the fumes though!
            Personally, if I wasn’t on PFiT I would be grid free now. Our house uses 4KWh /day and the 2.6KWp array exports 4 times as much this time of year. Grid free avoids usage charges/GST etc. and accelerates payback time.
            Of course we don’t have a pool, spa, 70″ Plasma TV etc.

          • David Pethick

            Hi Mike

            Power prices and “service to property” charges are a bit cheaper where you live, obviously making it a bit tougher to justify going off-grid.

            $30 a month sounds pretty cheap to me, to know that you’ll always have electricity. That’s one reason why I think we won’t see widespread disconnection in the suburbs.

            The bigger reason why I think few will disconnect from the grid is that it kills distributed energy. Disconnecting from the grid doesn’t only make it impossible for you to purchase energy from a big coal-fired power station 500 miles away. It also means you can’t purchase it from your neighbour. Or sell it. Or buy it and store it to sell it later. Or sell it now and buy it overnight from the grid. There are lots of possibilities for efficient generation, storage and usage of energy created by a smart grid. Grid disconnection removes them all.

            Stay connected Mike!

            Cheers.

            Dave P.

  • Ken Fabian

    Perhaps the most significant consequence of such rapid improvements in financial viability of energy storage may be political; the economic alarmist fears that have been the fundamental driver of opposition to a transition to low emissions are going to diminish in response. The most influential lobby groups – business ones – have tended to be staunchly opposed in practice even as they shift towards in-principle statements of support; having that constant and potent opposition ease would be significant but having them become part of the solution would be even better.

    The Transition may be able to proceed simply on the basis of costs but I still think it needs some serious commitment and forward looking policy.

    • Ren Stimpy

      It’s not just the opposition by 25% of the population that is preventing action, it’s the apathy of some 50% of others in the population. I am more and more convinced that only by leveraging people’s self interest can we solve the problem of climate change – showing real cost savings for people and businesses by them reducing their energy consumption, generating it themselves and storing it for later consumption to avoid peak charges, all without inconvenience nor reduced productivity.

      “Saving Money For You” should be the motto of climate action groups, and the problem would be solved in ten years.

      “It’s Good For The Environment” is just not cutting the mustard, and it never will.

  • Ken Fabian

    In many ways the framing of the issue as “green” – I think in part
    political environmentalism seeking to raise public awareness as much as make the issue theirs, in part
    opponents of action seeking to frame it that way in order to associate
    it with radical fringe politics to discredit it – has not been helpful.
    It is a mainstream, central issue about long term economic prosperity as
    much as it is about endangerment to remnant natural ecosystems. I think
    “greens” seeing it as the latter is understandable. I think mainstream
    and Right conservatives steadfastly refusing to see it as the former, or as a problem at all, is
    not.

    • Rod

      I”m not sure what the situation looked like before Abbot’s attack on the Carbon Tax, but since then Climate change in Australia has taken Partisan lines.
      Many other sane Nations have taken a Bi-partisan approach and are just getting on with it.
      Now that RE is on par with FF financially, Conservatives everywhere should be on board but politically, for now, some in the electorate support the status quo.

  • Marcus

    Have had the LG Chem 10kWh battery going for 2 weeks now, what a beauty she is. Off grid in the burbs!
    The lowest capacity we have got to overnight, after wild night for us- up till 1 am with house full, was 23%.
    Clean coal my arse

  • howardpatr

    Sophie; thanks for another great article.

    I and I suspect many others would appreciate an article on how the likes of a Powerwall 4.0 will be able to be integrated into a system that can eventually provide for EV charging – having the DC go directly to the vehicle and not be unnecessarily using the home storage battery.

    Perhaps there are others out there who have plenty of room for ample room for PV to provide power for the home and vehicle but are curious about inverter, battery storage and direct EV charging will appear.

  • MaxG

    Installing solar PV was great… installing my battery was priceless 🙂
    Being able to cut the chord at the blink of an eye… powerful!

  • Matt Smith

    Generating power from the sun won’t generate jobs or growth, climate change is also a myth. Seems to be the running consensus in the coalition party room.