South Australia has a higher percentage of solar homes than any other state in Australia – and in the Adelaide area, roughly 1 in every 3 homes has a solar PV system. These facts set Adelaide up to become a hot spot for energy storage – even more so in light of the City of Adelaide’s solar and energy storage incentives. What do Adelaide residents need to consider when thinking about battery storage for homes?
Key considerations for solar-plus-storage in Adelaide
If you live in Adelaide and are interested in energy storage for your home (or business), you most likely fall into one of four categories. Depending on which category you are in, your approach to energy storage will be different. We’ve outlined these categories below.
- You already have a solar PV system and benefit you are the recipient of South Australia’s generous 44c/kWh solar feed-in tariff (which may be higher depending on your electricity retailer). Unless you move house, you will continue to receive this benefit until 30 June 2028 (and so will any future resident of your home). Because this program rewards you for exporting your solar power to the grid, it is not in the best financial interest of homes who are signed up to install batteries for their existing solar system – the solar power is worth more when it is sold into the grid than when it is consumed by the home.
- You already have a solar PV system and your base feed-in tariff rate is 16c/kWh. When SA’s 44c/kWh was closed to new applicants on 30 September 2011, the base rate dropped to 16c/kWh for new applicants for the following two years (after which point it was again reduced – discussed below in 3 and 4). The 16c/kWh payment will cease on 30 September 2016 – after which it will presumably be reduced to only a nominal amount – around 6-8c/kWh. Once this happens, Adelaide homeowners may begin to see the value in installing batteries to prevent their excess solar power from being ‘wasted’ on the grid – so that they can instead use it themselves.
- You already have a solar PV system and are currently receiving only about 6-10c/kWh. In this case, batteries may make sense for you right now, depending on what percentage of the solar power you ‘self-consume’ (i.e. use directly) and what rate you pay for your electricity.
- You do not yet have a solar PV system, but you’re in the market for them and are also interested in learning about batteries. You could install a system with batteries, but the amount of solar PV and battery capacity you should get will depend on your goals and your budget. (Read more: How much battery capacity do you need?)
Below we examine each of these scenarios in more detail.
Category 1: Adelaide home with existing solar system, receiving 44c/kWh
We’ve noted above that those who are currently receiving the 44c/kWh feed-in tariff will have little financial incentive to install batteries to capture their excess solar power. (In fact, these homes would be wise to export as much of their solar as possible!) However, if a homeowner’s visceral contempt for the electricity generation & distribution complex trumps economic rationalism, they may consider the move anyhow – in which case they should look at the recommendations for those in Category 3 below and take them to the extreme.
Category 2: Adelaide home with existing solar system, 16c/kWh base feed-in tariff
South Australia’s 16c/kWh solar feed-in tariff is a modest but respectable incentive, and any household receiving it would do themselves well to appreciate and take advantage of it. Because there is also a retailer contribution of ~5-10c/kWh that is tacked on to the 16c/kWh base rate (bringing the total to about 26c/kWh), most households – paying ~26-30c/kWh for grid electricity – will only have a slight imperative to self-consume their solar power in order to maximise their savings. This greatly reduces the financial case for installing batteries. However, the 16c/kWh rate will only be paid out until September 2016 – after which point they will be in the same situation as those in Category 3 below – with battery storage beginning to look like a significantly more attractive prospect.
Category 3: Adelaide home existing solar system, no feed-in tariff available
Battery storage may already make sense for homes in Category 3 right now – especially with the City of Adelaide’s energy storage incentives. Basically, for those in Category 3, any solar power not consumed directly by the house is ‘wasted’ by being sold into the grid at very low rates – only about 6-10c/kWh. These homes – who probably resent their electricity retailers – may get more value out of their solar systems by capturing that excess solar energy and storing it for later use.
Example: An Adelaide household which consumes an average of 20kWh of electricity per day (on the ‘double hump‘ pattern) and has a 4kW solar PV system installed. This home is likely to be exporting around 10kWh of solar to the grid on the average day – and this is roughly the amount that they would want to be able to capture in their battery bank. Assuming 95% round-trip storage efficiency and 80% maximum recommended depth of discharge (DoD), 12kWh of battery capacity would help the household meet this goal.
Energy flows for Adelaide home with 4kW solar system, 15kWh daily electricity usage (on average) and 9kWh of battery storage. With the battery storage, this home would utilise close to all of the electricity produced by the 3kW solar array. (Key: Grey shaded area is grid electricity consumption, orange shaded area is solar self-consumption, and shaded purple area is battery storage usage. The yellow line is solar system power output, while the purple line is battery state of charge – aligned with right axis. The blue bars represent solar into batteries, while the red bars represent solar into the grid.)
Category 4: Adelaide home with no solar system, no feed-in tariff available
Homes in this category will either want to install a solar-plus-storage system or just a plain old solar PV system without batteries. In either case, they will have a lot of flexibility and a wider array of options than if they already had a solar system. At the moment, most homes will opt to install only a conventional, non-storage PV array (possibly with a battery-ready inverter for future upgrades) – in which case the system should be sized to meet daytime electricity needs (Read more: How to get the most out of your solar system.) However, battery storage may make sense for you if you find the right system at the right price.
Example: An Adelaide home that consumes 20kWh per day on average throughout the year would like to reduce their grid reliance by as much as possible within a $10,000 budget (the typical amount a home would be willing to spend, according to a recent survey). Let’s start with a 5kW solar system for about $6,200 (on the low end of the spectrum according to our August 2015 PV Price Index).
This would allow for about $3,800 to be spent on batteries. Assuming (optimistically) a battery storage price of about $1,200 per kWh, the home could afford about 3kWh of battery capacity (with 95% efficiency and 80% DoD). With this 5kW solar + 3kWh storage system, the home would only meet about 45% of its own electricity needs (and using on average about 45% of the solar produced). In fact, it may be wise for this home to reduce the solar system size (as a lot of the solar energy is being exported to the grid anyhow) and invest in more battery capacity.
Payback periods are another question altogether – but indicative assessments would suggest 10+ years – which may cause this household to question whether it’s a good idea to invest in the battery portion of the system at this point.
Energy flows for Adelaide home with 3kW solar system, 15kWh daily electricity usage (on average) and 5kWh of battery storage. The home would still be heavily reliant on the grid for electricity. (Key: Grey shaded area is grid electricity consumption, orange shaded area is solar self-consumption, and shaded purple area is battery storage usage. The yellow line is solar system power output, while the purple line is battery state of charge – aligned with right axis. The blue bars represent solar into batteries, while the red bars represent solar into the grid.)
Compare your energy storage options in Adelaide
Solar Choice recently launched Australia’s first Battery Storage Comparison service, which will allow you to compare installer offerings at a glance in an apples-to-apples format. This service is currently available only to new solar-plus-storage customers – not to those with existing systems (but this will soon change).
If you are looking for a new solar-plus-storage system:
Fill out your details in our Solar Quote Comparison request form to compare your options now (Click the ‘Battery Storage Comparison’ tab). Potential commercial clients are also invited to register their interest.
If you are looking to retrofit batteries onto an existing solar system:
Please enter your details into the form below and we will get in touch when battery storage only functionality becomes available.
© 2015 Solar Choice Pty Ltd