Enphase sees battery storage costs falling by half by 2020

US energy technology company Enphase says it expects battery storage costs and prices to fall by one half by 2020, as it prepares to launch its first battery storage product into the Australian market in a few months.

Enphase on Tuesday unveiled its new R&D facility in New Zealand, which will drive further improvements in its battery storage and micro inverter technology, and enable it to refine its home energy management systems that will be launched in Australia and New Zealand within a few months.

The California company has taken a different approach to battery storage – as it did with inverters – and is rolling out a modular, “plug and play” batteries storage offering, likely to start at around 1.2kWh, with the ability to be scaled up.

Chief financial officer Kris Sennesael said Enphase is thinking of prices of around $US1,000/kWh, but these were likely to be “fine tuned” by its launch, and prices could fall by half by 2020.

“I can almost see storage prices slashing in half over the next 3-4 years,” he told RenewEconomy in an interview from Christchurch, New Zealand, where the new R&D facility was opened.

“There will be some substantial price reductions as the cost of chemistry comes down significantly in coming years.”

Kris Sennesael says the market opportunity for battery storage is clearly growing. It expects revenue of around $US-$20 million in the second half of 2016 from battery storage, mostly from Australia and New Zealand.

This equates to around 2,000 systems (of 4-5kWh) but by 2020 the company expects global revenue from battery storage of around $US300 million.

Some analysts have predicted that one million homes could install battery storage within five years, and see Australia as the leading market in the uptake of battery storage, which explains why Enphase, Tesla and others have chosen to launch their first products here.

“One million homes would be fantastic. That’s a great number. It’s probably a bit too early to tell if it will get that far,” Sennesael says.

“This is a very nascent market. We have to learn a lot about it, and try to udnsand what the landscape is. But we are more enthusiastic about battery storage than ever before.

“We are also trying to understand what the competition is doing, but we haven’t seen anything that have to be afraid of.”

Enphase has spent another $US4.4 million ($A5.8 million) expanding its R&D facilities in Christchurch, where it has been conducting R&D for the last five years, one of the reasons being that in New Zealand it is able to test its products on the grid, rather than through a grid simulation.

The new facility will allow it to conduct global compliance testing and verification capabilities for its microinverters and expand on the future development of its AC battery, a modular energy storage system that integrates with its Home Energy Solution product.

Fox says the ability to conduct this testing “on the grid” means that New Zealand is a key resource for the company.

He says the Christchurch played a key role in developing the fourth, fifth and now the sixth generation of Enphase micro inverters, and will now focus on battery storage as well.

The Christchurch team’s charter will now include the development of future generations of the Enphase Home Energy Solution in line with the company’s product roadmap.

New Zealand residents can register their interest to purchase the Enphase Home Energy Solution through https://www.enphase.com/au/register