AGL offering 7.2kWh battery storage at under $10,000 | RenewEconomy

AGL offering 7.2kWh battery storage at under $10,000

Print Friendly, PDF & Email

AGL Energy is offering battery storage systems at a steep discount to even wholesale prices. But there may be method to their madness, locking in customers for the long term and reaping benefits from battery storage systems. But it underpins the potential for battery storage costs to fall quickly and sharply.

share
Print Friendly, PDF & Email

Electricity retailing giant AGL Energy has taken the industry by surprise by offering 7.2kWh battery storage systems at under less than $10,000 each – in what appears to be a massive discount over prevailing wholesale prices, let alone retail prices.

The offering of the 7.2kWh Powerlegato battery system from its Taiwanese partner AU Optronics was made via its Power Advantage Club, a network established when AGL became the first of the major utilities to announce it was about to roll out a battery storage product to its consumers.

agl storageAccording to the email sent to club members, the battery storage system will be available in South Australia, Victoria and NSW, as well as Queensland. The price includes an inverter, control system, and “basic installation”, including connection to an existing rooftop solar system.

The price is less than one third of that offered for the same battery storage system to wholesalers, which, as we reported here in our story Tesla already forcing down price of battery storage, was already a one-third cut from  the price offered for similar battery storage applications just six months earlier.

The AGL pricing means that the cost of battery storage has fallen by more than half in just six months. As one analyst noted: “Either they are getting a huge discount for volume orders, or they are doing a loss leader (or both!).”

But there could be method in their madness, if that is what it is. Customers need to pay for the system upfront, as there is no finance. They also have to lock in for a long term contract with the retailer, so it seems that AGL is willing to offset upfront losses for long-term gains.

Also, given the current tariff structures, AGL is more likely to benefit from any network and tariff advantages from the battery storage system than the customer.

The AGL offering also includes rewiring of one household circuit so that it will be backed-up by the battery storage system, and the set up of the battery monitoring software.

AGL Energy says it is targeting the “early adopter” market of home energy “front-runner”, and doesn’t believe that battery storage will come down to “mass market” prices until after 2020.

However, there is considerable debate about this. Many smaller firms believe the mass market price point will arrive much earlier than that, prompted by the Tesla battery storage offering and matching price offerings from its competitors.

Analysts are also curious why, in some cases, basic battery storage systems can be bought in China for around $150/kWh but then marked up to $1,000kWh when sold in Australia. The additional of a battery management system will put the price up, but not to this extent.

“That’s a ton(ne) of markup,” said another analyst.

solar csfb

It makes some expect that the cost of battery storage could fall dramatically, in the same way that rooftop solar panels fell sharply seven years ago as the mass market and its associated dynamics took hold.

This graph above, from Credit Suisse, indicates what happened and how a market known for high prices and high margins quickly transformed into a low price, low margin commodity. The Tesla gigafactory may just be a prompt for a similar trajectory in battery storage.

 

 

 

 

Print Friendly, PDF & Email

48 Comments
  1. Johan 5 years ago

    It’s important to remember here that 7.2kWh is only the nominal capacity. The real capacity for this battery is closer to 6 kWh. Great price for this unit though (although it’s still a good question why anyone would look at this versus Tesla – and similarly priced units).

    I wonder how the customer can be “locked in” for the longer term as described in the article, considering the low barriers to exit from energy retailers across the board. One would think that the structure is such that the customer only gets access to “the smarts” if they’re an AGL customer and that there’s no access to data/intel if the customer leaves AGL.

  2. Robert Johnston 5 years ago

    Is it just me that thinks the ACCC should be stepping in for an explanation on why you need to sign up for a long term electricity contract when you buy a system to store electricity? Seems to be fairly anti-competitive in my uneducated observation

    • RobS 4 years ago

      Only if you are obliged or under some form of duress to make the purchase, otherwise they are simply offering a product for purchase voluntarily with certain terms and conditions, if you don’t like the conditions then you are free not to purchase the product

  3. Johan 5 years ago

    I think they would be getting around that by only offering particular functionality (i.e. limited functionality if you leave AGL) for non-energy retail customers.

    I do think on the other hand that ACCC should take a proper look at electricity retail discount pricing though. Many customers think that a “30% discount” deal from one retailer is better than a “2% pay-on-time discount” from another, even though that may not be true. And who can blame the consumer in that instance?

  4. Bob_Wallace 5 years ago

    The 7 kWh Tesla Powerwall is $3,000, is it not? This is 7.2 kWh for $10,000.

    What?

    • RobS 5 years ago

      And here’s http://store.energymatters.com.au/bpt-s5h-6-6 the Bosch grid interactive storage system offerred from an Australian retailer for $31,000 for 6.6kwh. Its a new and rapidly evolving industry with a huge price spread and the AGL offering is very much in the better end of the spread. I will hold judgement on the Tesla system until i can buy a ready to install system retail with the appropriate grid interactive control system, until then its practically vaporware.

      • newnodm 5 years ago

        The must be some interesting meetings taking place a Bosch.

      • Jacob 5 years ago

        So when the iPhone was unveiled in 2007, did you say “it is vaporware because it is not sold in AUS yet”.

        • RobS 5 years ago

          The Powerwall is not sold anywhere yet and my point is that the pricing that has been released is wholesale pricing and we don’t yet know enough to know what the retail markup will be, who and how much installation will cost, what other equipment will be required to allow solar and grid interactivity and when it will be available. Whereas this is priced including installation and is turn key including grid and solar interactivity capability. Until the Powerwall is released anywhere or a lot more information is released than the sparse PR info released so far then it is really not possible to make a fair comparison. My suspicion is that once you add retail markup, installation and control systems the Powerwall is going to end up around $7-8,000. When the competing systems are $25-31,000 then I think it’s pure fanboyism to dismiss a turn key system being sold fully installed for under $10,000 because of a system with unknown pricing and an unknown release date. Don’t get me wrong I expect and hope that the Powerwall is going to be a part of a game changing revolution in storage rollout on a mass scale but I think this AGL offering is hugely significant too.

          • Bob_Wallace 5 years ago

            Tesla has said that the retail price will be US$3,000. That’s the retail price on their website.

            Elon’s statement was that installation will need to be done by someone trained, i.e., licensed electrician. It will be interesting to see if one has to “prove” that the installation is done by a licensed electrician. I suspect not. I’m guessing that Tesla is saying this in order to relieve them of any responsibility if Bubba hooks it up backwards and fries something.

            I’m not dismissing the $10k package. Just saying that they’re probably going to have to cut their price when sales for the Powerwall start.

          • RobS 5 years ago

            Cut and pasted from Tesla’s Website “Tesla’s selling price to installers is $3500 for 10kwh and $3000 for 7kwh. (Price excludes inverter and installation)” that suggests wholesale trade pricing to me and they haven’t revealed if they will retail them directly for people to use with their own installers or install themselves that I have seen. I relish the idea of being proven wrong but my suspicion is that these are going to end up being around $7,000-$8,000 once mark ups are applied and they are fully installed. I hope that they do trigger increased price competition but at the moment the AGL unit is competing with what’s currently available in the market and $30,000

          • Bob_Wallace 5 years ago

            That is not on the main US Tesla Powerwall page.

            http

            ://www.teslamotors.com/powerwall

            I have never seen a business list a wholesale price for the general public to see.

            This is a ‘wait and see’. (But $8k is less than $10k. ;o)

          • RobS 5 years ago

            Cut and pasted from their press page on the new Powerwall.
            http://www.teslamotors.com/presskit
            Also don’t forget the AGL $10,000 is Australian dollars which is $7,488 US dollars, I maintain I think this is a VERY competitive offering.

          • Bob_Wallace 5 years ago

            Doesn’t say that “installers” can’t be end-users. ;o)

            We’ll have to ‘wait and see’. The Powerwall was not a smooth run out….

          • RobS 5 years ago

            In australia it is illegal to make any alterations to a house’s high voltage wiring without being a registered electrician. I agree all we can do is wait and see, I’m simply saying that dismissing a ~$7,500 USD 7kwh (turn key including inverter and installation) storage system I think is jumping the gun in a big way.

          • WR 5 years ago

            You don’t have to be an electrician to buy the powerwall from Tesla, they are selling direct to the public. You only need to be an electrician to install it. So the householder can pay Tesla’s price and import the powerwall, then hire an electrician to install it.
            Once the market for the Powerwall becomes established in Australia, any installer who tries to put a mark-up on the battery above the import cost is going to be competing with people who know they can buy direct from the factory. The mark-up merchants aren’t going to win that battle.

          • RobS 5 years ago

            Do you have a reference for Tesla retailing Pwerwalls direct to end consumers, considering their website specifically states the released price is available “to installers” that would suggest to me they may well not be doing direct end user sales, I have not seen anything definitive either way but I don’t see why they would specifically state the price as being available “to installers” if it’s not limited to trade sales. Either way none of this changes my primary point which is that the AGL offering is a firm price fully inclusive of control equipment and installation whilst the Powerwall remains doubtful in terms of price, availability, installation cost and requirement for ancillary equipment, the AGL offering is highly competitive with current offerings, the Powerwall may or may not undercut the AGL offering, anyone claiming it definitely will or won’t is speculating on a number of unknowns.

          • RobS 4 years ago

            Feeling vindicated for my healthy scepticism. First retail installer of the 7kwh Tesla Powerwall in Australia is selling the system installed for $9,500. http://www.theaustralian.com.au/business/technology/tesla-flicks-the-switch-on-powerwall-sales/news-story/ce87cb33129937c7eab808f3a8fe4215

          • Jacob 5 years ago

            Musk told everyone what the final retail price will be that night. U$3000.

            It had been a myth that the price announced was the wholesale price.

            The price of inverters are not expected to crash though. There is no inverter gigafactory.

          • RobS 5 years ago

            Well I can only go on what Tesla’s website states and that is “Tesla’s selling price to installers is $3500 for 10kwh and $3000 for 7kwh. (Price excludes inverter and installation)” http://www.teslamotors.com/presskit To me that means trade wholesale pricing, most installers don’t on sell solar systems for the same price they buy them for and I see no reason the Powerwall would be any different. But this is my point, until you can actually buy one we’re all just guessing, that’s what I mean by vaporware, its all completely speculative. Meanwhile the AGL offering is a firm all in price including inverter and installation for $10,000 AUD or ~$7,500 USD which is 50-70% cheaper than the currently available alternatives, and I storngly suspect at worst only 10-20% more expensive than the powerwall once it is available.

          • Jacob 5 years ago

            Maybe Tesla can sell them via their car showrooms in AUS.

            They cut out the middle men (dealers) when it comes to their cars.

          • RobS 5 years ago

            Maybe, however I think its more likely that they will partner with a few of the larger solar retailers who already have large installation networks established., I cant see people picking up a powerwall at the Tesla showroom and chucking it on the backseat of the car to take home for the local sparky to install. But once again my point is being further reinforced, AGL’s offering is a comprehensive solution being offered fully featured and fully installed by a company with one of the largest network of electricians in the country. The Powerwall is the first such product from a company with no history in grid interactive electrical products with no established network, selling a product whose final price and release date we don’t yet know and with unknown requirements for ancillary support equipment. The final cost of the Powerwall fully installed may be $4,000 or it may be $10,000 we just don’t know until more information is released. My guess is it will be somewhere between $6,000 and $8000 US (~$8,000-$10,500 AUD) putting this AGL offering very much in the game price wise.

    • newnodm 5 years ago

      Bob
      1) $USD vs $AUD
      2) Probably more parts in the AGL offer
      3) Tesla is $5K USD installed without inverter.

      Here is a cutsheet of the parts needed to install a Powerwall with a solaredge inverter. We don’t know yet what the AGL price means.

      http://www.solaredge.com/files/pdfs/optimizing_self_consumption_flyer_eng.pdf

      • Bob_Wallace 5 years ago

        $3,000 US is A$4,030. I don’t know where the $2k installation cost came from, $500 is more likely. The AGL has a built in inverter which eliminates two wire connections (but makes the unit a lot harder to move).

        Add on an inverter. Inverters don’t cost that much.

        Once the dust settles I suspect the Powerwall is going to be significantly cheaper.

        —-

        An aside, but I’d be hesitant to purchase “all in one” systems. Better to have separate charge controllers, battery chargers, inverters and batteries so one is not locked into a single manufacturer. And so if one component needs replacement the entire unit has to be shipped back or someone from the manufacturer doesn’t have to make a home visit.

        I’m off the grid. I keep a spare battery charger (~$200), spare charge controller (~$60) and small backup inverter (<$100) on hand. If something fails I can get the system back up in a short time. All of that backup is cheaper than a single service call.

        • newnodm 5 years ago

          Musk guessed at $1000 extra, solarcity says $1500. But that is based on a new solar install. The solar install itself will probably be upgraded from an inexpensive string inverter. The system shown in the solaredge link requires power optimizers, which add maybe $250/kw in initial price.

          The devil is in the details. Details cost money. Spend an hour on the new soledge storedge/powerwall presentation in the GTM archive and then tell me about “spare change”.

          • Bob_Wallace 5 years ago

            I changed out my lead acid batteries last year. 12 trips in with a battery. I could have stuck a 200 pound Powerwall on my cart and done it in one trip. Then I had to bolt in the 12 batteries, two posts each. The Powerwall is already assembled.

            If you’re talking Powerwall vs. another packaged storage system the labor is going to cost about the same. Most likely you’re going to spend more for the electrician’s travel time than actual labor. The labor to connect storage to an inverter is minor. A few minutes.

            Will it cost more to get the voltage up to the Powerwall input level? That would seem to be involve only the way you design your solar panel wiring.

          • newnodm 5 years ago

            Bob, please spend the time to learn how the powerwall can be implemented. It is not a 48v replacement. The powerwall is part of a 400v computer controlled integrated system. Your lead acid batteries were designed in 1930.

            The cheapest inverter that will work with the powerwall is $2K USD. Few if any powerwalls will be added to existing system without inverter replacement. Computer control. Networked. Did I mention computers? Microprocessors Bob, Microprocessors. Nothing happens on these systems without a command from the central processor in the inverter. There isn’t even any significant voltage on the main DC line from the panels until the inverter commands the power optimizers to charge the system.

            This is a changeover to new technology. It is not an upgrade. It’s all with a long warranty too. So while it may be complex, it should not be less reliable. Not that FLA is reliable.

          • Bob_Wallace 5 years ago

            new, my knowledge level is a bit higher than you suspect. My lead acid batteries were designed about four years ago. (New Trojan Battery design for RE systems.) Microprocessors have been part of inverters for a long time. We left the dc motor driving an ac generator type inverter decades ago.

            Inverters do not control battery charging. They turn battery/panel DC into line voltage AC. Battery charging is controlled by battery chargers (generator infeed) and charge controllers (solar panel infeed). Sometimes those devices are packaged into the same container, but they are separate units and perform separate functions.

            Input voltage for the Powerwall is 350 to 400 volts. If someone has a 12, 24, 48 or 600 volt wired array that will mean a rewiring or a DC/DC converter (kind of lossy). On the other end an inverter to step down from 400 vac to 120 vac or 240 vac will be needed.

            $3,000 for the Powerwall + $2,000 for an inverter. $5,000 US = AU$6,700.

            Converting from a 12, 24, 48 or 600 volt system to 400 volts will require more labor along with a new charge controller (<$200). Possibly a battery charger if the system has a backup generator.

            There should be no labor difference with a new install regardless of which storage system is used.

          • newnodm 5 years ago

            But you missing solaredge power optimizers for each panel, plus an auto transformer to balance the split phase. These parts are not optional. You don’t need a charge controller. You can’t use an external charge controller. The powerwall is not a battery. It is a battery subsystem with a charge controller that only acts on commands from an inverter designed for the powerwall. It only charges when the circuit is appropriately powered and it receives a command to charge.

            You don’t need to do anything to AC, as the inverter will give the appropriate output.
            Fronius may come out with less expensive implementation of the powerwall. Neither manufacturer has announced off grid yet.
            Even without the inverter, the typical solaredge install will be at least $600-700/kWh for a single 7kWh powerwall. Perhaps dropping for multiple powerwalls in off grid.
            On grid, a secondary panel of circuit breakers is also a requirement if grid down power is wanted.
            All these costs are why 2020 is a more appropriate time frame estimate for substantial behind the meter batteries in the home.

          • Jacob 5 years ago

            The 100kg Powerwall is bloody heavy. It would require 2+ men to stick it on the wall.

            While a typical lead-acid battery can be lifted by 1 man.

          • Bob_Wallace 5 years ago

            I’d like to see you lift enough lead-acid batteries to equal the Powerwall.
            Yes, it would take two people to lift the Powerwall.

  5. Gerberaman 5 years ago

    If something looks too good to be true, it usually is. I’m sure that AGL will have every intention of getting their money back plus a big margin. You can only imagine what the long term contract says, and what the tariffs will be in years to come. Anyone who puts their hard-earned dollars here is taking on a major player who will be absolutely determined to make a big profit at their expense. You all seem to be presuming that the contract can’t be binding. I would beg to differ. If you sign it, then you are stuck with it.

    • Jacob 5 years ago

      A lot of people still think that buying a mobile phone on a plan is a good idea.

      Prepaid is a much safer option. There is no possibility of getting a massive bill one month.

      And the price of the handset is built in to the contract.

  6. john 5 years ago

    Long term contract ok
    Is the retail price kept the same of does it mean your locked into supply at what ever the retail price is which I expect is the case.
    So a 7.2 Kw battery pack which if you use it to get the longest life possible you do not take past 80% DoD means you get 5.76 KwH of power to use per pack.
    So to be of large use one would need at least 4 of these packs at a cost in the high $38k plus area correct.
    So to have 23 KwH of power to use for say 10 years that gives you 83950 KwH of power so the cost per KwH using $38000 as the buying price @ 45c KwH
    Now lets take away the displaced power cost of 30c KwH so power @ $15c KwH
    Where does this not add up?

    • juxx0r 5 years ago

      The bit where 80% of 7.2 was 1.44 maybe.

      • john 5 years ago

        juxx0r fixed it up price comes to 15c kwh thank you for pointing out mistake.

    • nakedChimp 5 years ago

      I think this is Li-Ion (whatever flavor) and you can safely go to 50% DOD(*).. some even 30% DOD without risking the cells.
      If you just go to 80% the batteries will die from age instead of use.
      Your call.

      Ah, here you go for some specs:
      http://www.energymatters.com.au/images/auo/auo-powerlegato.pdf

      The rates on the 2nd page left bottom seem to indicate 6 kWh useable capacity.. 83% DOD.

      *) DOD = Depth of Discharge.. not charge left in battery.
      Your 80% number is from lead acid AGM/GEL/WET stuff that’s not ‘really’ designed for deep cycling.

  7. Mark Roest 5 years ago

    Since when, in the last year and outside Germany, has $1388 per kWh capacity been a bargain? If it were less than $1000 instead of less than $10,000, it would be worth writing about — that’s where prices will be by 2020. The Powerwall for daily charging use was priced at $429 per kWh; people have written that Tesla is paying under $200 per kWh for its autos.

    • RobS 5 years ago

      Can I buy one right now retail? Including all grid interactive control circuitry, If I can’t buy an Australian plug and play solution off the shelf now for under $10,000 for ~7kwh then you’re basically comparing vaporware to a real world product.

  8. Vincent Selleck 5 years ago

    I would rather have all my teeth pulled out than lock in to this outrageous offer by AGL. We have a charge controller that fits any existing inverter with 7.2 kWh of usable storage that can be fully installed for $7995. When initial cost of batteries and cycle life is calculated the package delivers power storage for 18 cents per kwh over the life of the batteries and can use either Gel or Lithium. Why would anyone want to be ripped off and then locked into a contract with AGL? Perhaps that is the only way they can get people will stay with one of the dirty three retailers who own coal fired power plants and mine coal seam gas in pristine environments against the wishes of communities, not to mention their vehement lobbying to trash the RET completely.

    Anyone interested can visit our website at http://www.888solartek.com.au . We are based in Northern Rivers NSW.

    • riotcat 5 years ago

      I just had a quick look – you advertise all of your battery systems at 100% discharge, using sealed lead acid batteries. At best, you’re selling 5kWh of usable storage on that example, if you want to be swamped with warranty claims in under 5 years.

      Are you looking to make a quick buck so you can leave your customers out of pocket with systems that don’t work, take a holiday and phoenix your company a few times over?

      • Vincent Selleck 5 years ago

        FYI – all our battery systems are at 50% depth of discharge. We are long term players in this market. Not sure where you got your info from.

        • riotcat 5 years ago

          Are they really? You are advertising 9.6kWh of storage at http://www.888solartek.com.au/battery-upgrade.html


          This Special Price Includes:
          888 Charge Controller with 5 year warranty
          8 x Motomo 100AH 12V Deep Cycle AGM Gel-Acid Batteries

          8 x 12 x 100 = 9.6kWh @ 100% DOD.

          Line up all your ducks before shooting back.

          • Vincent Selleck 5 years ago

            This advertised unit has a usable battery bank of 4.8kWh – 50%. The size of the full bank is used as our competitors are doing this in their advertising. No one would ever be sold with the impression that they are getting more than this. The 7.2 kWh I mentioned in the article is made up of 12 x 100ah 12 v cells or 14.4kWh in total for $7995. If you are concerned about this – don’t buy.

          • Christopher 4 years ago

            agreen on vicent.

            your suggestion is very attractive. so parallel wire 8 batteries, does same job as AC/DC
            inverter ??

  9. Alen T 5 years ago

    Giles, you state that this price includes connection to an existing system, but you also state that it comes with an inverter and control system. My take-away from this is that the existing PV system, or more precisely the existing inverter, will be replaced with the AGL inverter. Cost of an inverter can be quite high, so is there one universal size (e.g. 5kW inverter) for all, or does this vary/depend on your existing system size? May have to reconfigure whole system (downsize/upsize to match new inverter).

    I’d also be interested to know how responsive the system is to changes in panel output, i.e. if cloud cover impacted output for 5,15 or 30 mins will the battery kick in and disconnect automatically for this short period, or is it a case of once the battery is on it takes over for a long period. Same if you have oven going and turn on the pot for a few minutes, going over inverter kW capacity, will battery take up partial slack e.g. 6.5 kW demand -5kW inverter and battery supplies the 1.5 kW) or will battery completely take over?

  10. Roger Brown 5 years ago

    I will stick with my Newman’s .44 cents(QLD) +.06 cents from Origin and a 3 kw system whips my bill down to a small profit . When 2028 comes a long , .50 cents a kwh will look very cheap . Battery storage would be sorted by then and cheap to go hi-tech battery storage and off grid ?

  11. barrie harrop 5 years ago

    The mass market is less than 20mths away,that is a payback in 3–5 years.

Comments are closed.

Get up to 3 quotes from pre-vetted solar (and battery) installers.