Expanding Into Home Energy Storage

Tesla Powerwall


The main problem with many current renewable energy systems is that the energy generated needs to be stored so that it can be made available when demand is highest. This problem is most obvious in the solar PV sector in which most electricity is generated by solar panel arrays during the day but demand is highest in the mornings and evenings. The only way to respond to this so far has been to export the excess energy to the national grid and buy it back when needed. In the UK this means a loss of income, since the price for the electricity you buy back from the grid is higher than the price you are paid when exporting it. It figures then that it is more cost effective to consume the electricity than to export it.

The mismatch also means that, to a certain extent, conventional power plants have to be on standby to provide backup power, and that means more carbon emissions.

The answer to this is energy storage. Recognising the demand, an increasing number of electric vehicle manufacturers have begun to expand their operations from EVs into the domestic and industrial energy storage market. The most prominent companies developing storage systems include Tesla and Mercedes-Benz/Daimler.

Tesla’s solution is the Powerwall, an energy storage system that is aimed at domestic residential customers with solar PV arrays installed. The product was launched officially in Los Angeles in April and is based on lithium ion battery power. The Powerwall generates financial savings through load shifting – charging during low rate periods when demand is lower and discharging when demand is higher – and increasing the owner’s consumption of solar energy. It also helps to provide energy security against outages which is particularly useful in areas with high storm activity or unreliable power grids.

Powerwall incorporates a liquid thermal management system, a battery management system and a smart DC-DC converter for controlling the power flow. It is 92 percent efficient and is compatible with single phase and three-phase utility grid supply. It is available in 10 kWh weekly cycle and 7 kWh daily cycle models which are guaranteed for ten years and can power most homes during peak evening hours. Homes with a greater energy need can combine batteries up to a total of 90 kWh for the 10 kWh battery and 63 kWh for the 7 kWh battery. The two systems are being distributed through a number of partners, specifically Treehouse, Fronius, SolarEdge and Green Mountain Power.

Tesla is also providing utility scale storage systems in which 100kWh battery blocks are grouped to scale from 500kWh to 10MWh+ and are capable of providing 2 hour or 4 hour continuous net discharge power using grid tied bi-directional inverters. These systems provide peak shaving, load shifting and demand response services for commercial customers alongside renewable firming and a variety of grid services at utility scales.

At the time of its launch, Tesla announced that the 10 kWh battery would be available for $3500 (£2239) while the 7 kWh would cost $3000 (£1919). It must be borne in mind that this price covers the battery itself, not the final total including associated costs of installation and the addition of an inverter. Just prior to the launch, The Guardian predicted that the total price would amount to around $13,000 (£8,313) although the Washington Post countered this by reporting that the likely costs would be significantly lower, although still expensive. In general, the Powerwall’s entry into the market has been well received with regard to its likely total cost. Jesse Morris of the think tank Rocky Mountain Institute, for example, said that the likely price for installation of the system was “well under” that expected by the institute and other research organisations. The Washington Post said that a simplistic analysis of the system would indicate an ability to cover a third of the 30 kWh consumed by the average American every day. This wouldn’t be enough to go off-grid but it would be effective as backup power to guard against outages.

The sticking point seems to be the price. At present, only larger, wealthier homes would be able to afford it. Forbes estimates that, combined with a solar power system, the Powerwall will deliver electricity at 30 cents (19 pence) per kWh. That means it only really makes economic sense, at present, in areas where electricity prices are currently high and look to remain so. This would include regions such as Hawaii and Australia.

Nevertheless, Texas power company Oncor has indicated it would be interested in investing several billion dollars in energy storage and Powerwall has indeed proved popular so far – systems have already sold out through to the middle of 2016, including orders from 2,500 business customers.

The company is now working on a larger version of the Powerwall intended for businesses and is also developing a $5 billion ‘gigafactory’ to produce the batteries. Located in the Nevada desert, it is expected to start operations in 2017.

Tesla’s main competitor in the home energy storage market is Daimler, parent company of Mercedes Benz, which recently announced a similar product to the Powerwall, through its subsidiary Deutsche ACCUmotive GmbH und Co. KG, established in 2009. This company develops, produces and markets highly complex drive batteries for hybrid and electric vehicles using lithium-ion technology. However, it has now also started to develop stationary energy storage plants for industrial customers and private applications.

Deutsche ACCUmotive also has plans to cooperate with EnBW in the private customer segment and is planning to collaborate with other sales and distribution partners both in Germany and at an international level. For example, it is aiming to establish projects at locations such as supermarkets where the plants can help to buffer load peaks on hot days. Private households with solar PV systems can also use the technology to buffer surplus solar power and some plants have already been operating on a trial basis. They became available for ordering in June and were presented at the Intersolar Trade Fair in Munich, Germany (10th to 12th June). Deliveries are scheduled to begin in September.

Daimler’s battery modules have an energy content of 2.5 kWh for private customers and 5.9 kWh for industrial customers. They are manufactured by Deutsche ACCUmotive in Kamenz, Saxony, employing state-of-the-art production methods. As with the Powerwall, the battery pack is mounted on a wall and is related to the battery pack found in the company’s EVs. For customers within the private sector, up to eight battery modules can be combined in order to produce an energy storage plant with a capacity of 20 kWh. These systems are fully scalable for commercial and industrial use.

Harald Kröger, Head of Development Electrics/Electronics & E-Drive at Mercedes-Benz Cars, believes that the company’s energy storage projects confirm that lithium-ion batteries manufactured in Germany have a viable future. Deutsche ACCUmotive has brought its considerable lithium-ion expertise which has enabled Daimler to accelerate its transition to sustainable energy generation both on the road and with regard to power supply for businesses and private households.

“The technology that has proven its worth over millions of kilometres covered in the most adverse conditions, such as extreme heat and cold, also offers the best credentials for stationary use” said Kröger. “We have been gathering initial experience in this field since 2012.”

Although Daimler hasn’t, as yet, released any price information for its product, the company is hoping to replicate Tesla’s success with the Powerwall which Deutsche Bank has estimated could earn Tesla $4.5 billion of revenue. Initially, the batteries will only be available in Germany but Daimler has indicated its willingness to expand to other countries in the near future.

About Robin Whitlock
I am an experienced freelance journalist with a wide and varied portfolio to my credit including web content, magazine articles, reporting, features, interviews, reviews and blogs. My special interests include environmental issues, particularly climate change, renewable energy, transport, green building and sustainable infrastructure. I have numerous secondary interests ranging from politics and current affairs to social justice, science, technology and innovation, historical topics and lifestyle subjects such as literature, psychology, contemporary spirituality and culture.

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