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Why 2.6GWh of battery storage is achievable in next few years

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Solar Analytics

Last week the CSIRO’s Low Emissions Technology Roadmap report was released officially by the Government.

Perhaps unsurprisingly, the announcement of the release was focused on the role of gas rather than some of the more interesting findings of the report which actually highlighted the inevitable and huge role that renewables would play.

In almost every scenario the role of renewables resulted in benefits – even though it has been argued that the report was “a stitch up” and very obviously designed to downplay the benefits.

It used inflated costs for solar and wind (above what the market price is already) and an extremely conservative view on escalating gas prices amongst other things. Wind and solar were described as “variable renewable energy” (VRE).

Renewable energy is cheaper. Full stop.

Despite this, there are three astoundingly profound statements that emerged and simply couldn’t be buried.

The first was that “…a reliable electricity system delivering 95% abatement in 2050 compared with 2005 levels and VRE share of ~90% is possible at moderate cost ….” and “…a VRE share of up to 40-50% is possible without requiring any enabling technologies for supply-demand matching…” and even more incredibly that it “is 18% less (cost) than in Pathway 3, in which VRE share is limited to 45%”

What these highlight in simple terms is that using 90% renewable energy is cheaper than using 45% renewables. It also highlights (over and over again) that there are no reliability issues that can’t be readily overcome with either 45% or 90% renewables.

Despite what the mainstream press or some of our leaders have said, the CSIRO and co-authors (the Electricity Networks Association) have concluded that far higher renewable penetration levels are a non-issue.

 2.6GWH of storage is plausible.

The second interesting finding is that to fully unleash 90% renewable penetration, 2.6GWH of battery storage is required for every 1GW of or renewable capacity (presumably once the 45% penetration threshold is passed).

Is 2.6GWH per 1GW of (say) solar even achievable?

In rough terms, Australia installs around 0.5GW of rooftop solar per year. In rough terms 2.6GWH of storage is around 330,000 battery installations at today’s average size.  So, that means we would need to install around 168,000 batteries per annum to allow 90% penetration.

This means that within a few years, every solar system would need to be installed with storage if today’s rates of installation continue, an ambitious target.

However, I mapped out some growth rates (see graph) that are more conservative than historical solar growth rates and you know what? It’s entirely plausible.

batteryenergy storage aus

Critically, I can very easily see us hitting our first 2.6GWh within just three or four years. Even more powerfully, one cannot overlook the fact that there are already almost 2 million homes with solar (or 5GW) already installed and mostly already paid for, so there is an existing market to help kick start it.

Beyond these factors, its feasible that we may see support for batteries and certainly, we will see larger batteries at lower prices, very quickly.

Fascinatingly, mapping it out to just 2025 shows the potential for almost 6GWH of batteries across more than 760,000 homes – 25% lower than other pundits have forecast for Australia.

So, it’ entirely plausible.

This report is huge and complicated but for me at least, these two issues alone are powerful and incredibly understated.

Source:Solar Analytics. Reproduced with permission.  

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  • Mark Roest

    A more common way to express it is simply 2.6 hours of storage for each kilowatt of solar. When you get to the tornado of demand, the soft costs can be driven way down, and as installation practices are standardized around a few sizes and use cases, those costs also fall. That means you don’t have to add too much to what I expect will be volume selling prices of batteries of $150/kWh within 2 years, and $100/kWh by the end of 2020, in US dollars and before shipping and import duties. Actually, if the market demand goes high enough after the 15 GW plant in Town-something, a full size plant could be planted in Australia, and that would mean no shipping or import duties.
    So 2.6 GWh would be $260 million to $390 million for batteries, plus maybe $50 million to $150 million for installation and other soft costs. Lots less than most people expect!

    • Ian

      The $150/KWH is already achievable for electric vehicles so home batteries can’t be too far behind with this sort of pricing. Would you buy a battery to cover an ordinary day’s storage requirements if the KWH cost was 10c and the battery lasted at least 5 years? Then 10c x 365 x 5 = $180/KWH. Any storage price around or below this figure will see home storage go ballistic. Double this purchase price for a 20c/KWH and you would probably still have a brisk uptake of batteries. Taking a stab at figures at a installed battery price of $400/KWH 1/4 of households installing solar plus storage would be enabled to become virtual-offgrid – only requiring the grid for occasional back-up purposes. Back of envelope calculation: 1.5 million solar households 1/4 with batteries, average size battery 10 KWH = 3.7GWH. At the lower battery price figure: all solar house holds would have storage and go virtual-offgrid = 15GWH .

  • Robin_Harrison

    The battery storage growth graph looks remarkably linear. I bet it’s not.

  • Ian

    Not to denigrate batteries, but South East Queensland already has a bloody big battery that is apparently hardly used – the Wivenhoe pumped storage facility: 5GWH. That should be enough to give some breathing space until battery prices drop a bit – has this sort of facility figured in their calcs ?

    • Jonathan Prendergast

      Agree. And NSW and Vic have even more!

      • Kevfromspace

        NSW and Vic do not have pumped storage (yet)

        • Jonathan Prendergast

          My understand is we/they do. Tumut, Shoalhaven, others

          • Kevfromspace

            Too right! I retract my comment 🙂

  • Shane White

    Do we need batteries or the declaration of a Climate Emergency?
    P.S – nobody will make money out of an emergency declaration though. Apologies for that.

  • Ren Stimpy

    One sparky with maybe one apprentice could probs install 3 home battery systems per day (it’s just anchor-bolting a Tesla 2 like box onto a garage wall isn’t it – and some wiring?). Whereas each rooftop solar installation takes at least 1 whole day. So it’d be 3x the install efficiency and then some for storage over solar.

    • solarguy

      Bolting a battery to a wall is just a small part of the job. If an installer knows the product well and doesn’t get bogged down with having to learn about other brands, they can get pretty good at the installation time line. But keep in mind that not all installs are easy. Average time to do one is 4hrs by 2 people, so I would suggest 2 per day at best.

      • Ren Stimpy

        As long as each install is top notch.

      • Ren Stimpy

        How long to install say 5KW of solar panels on average?

        • Joe

          About half a day

        • solarguy

          Although Joe has stolen my thunder, a straight forward single storey in about 6hrs. We have had some, that because of the difficulty took about twice that.

          • Ren Stimpy

            It takes almost as long to install a battery as it does to install a roof full of solar panels? Shirley you can’t be serious.

          • solarguy

            I told you not to call me Shirley and yes I’m serious. AC couple can be quicker depending on what brand that’s being installed. Tesla is a pain in the arse so my installers have told me.