Going off the grid used to be reserved for rural areas, but now it’s becoming viable in the suburbs – in both residential and commercial cases. But just because you can, doesn’t mean you should. Going off grid is certainly possible but it might not be for everyone.
Disconnecting from the power network can appear to be an attractive option. After all, an upfront investment in solar PV and battery equipment to never pay another power bill again sounds great. No longer will you have to worry about the cost of electricity increasing… and that’s just the beginning, right?
From a technical perspective, there’s nothing stopping you doing this with off-the-shelf equipment currently available. Solar PV is a mature and proven technology that can be sized to your energy requirements. Battery storage systems, while relatively immature in a residential environment, are nothing new. They’ve been around for decades in the commercial world and even used in nuclear power stations as emergency backups.
So what’s stopping us all from jumping off the grid right now?
Reliability
Reliability can be a subjective topic as it depends on so many factors, but if you select a brand name inverter and use high quality panels, you’d think that there’s no reason why your standalone power system can’t be as reliable as the grid – or possibly more reliable if you’re in SA! (only kidding)
Regardless, reliability is always a concern if coming off the grid. Even the best products are capable of failure or underperformance, and if you have a problem, there isn’t a 24/7 response available like there is with a grid outage. It’s up to you to fix, which means you could go a day or two without power if something goes wrong. This reason alone is enough for some people to keep a fringe connection to the grid.
Capital cost
If you’re happy providing your own power and the responsibilities that come with this, then it’s only the up-front cost that is going to deter you. This cost is now significantly less than it was even a few months ago, as illustrated by the new Tesla Powerwall 2. While the release of the first Powerwall model triggered a flurry of consumer hype last year – and a healthy dose of industry scepticism – Musk’s second release promises to impress even the hard sceptics among our industry.
If the specs are to be believed, the Powerwall 2 is one of the most economically viable battery systems produced, partly due to the in-built inverter, as removing the requirement to purchase and install an inverter (in addition to a battery system) eliminates a significant cost.
Combining an inverter with a battery system is nothing new – there are plenty of examples already on the market boasting this capacity – but it’s the dollars vs. capacity that is the real delineator with the Powerwall 2. For those of you who are curious, this fantastic battery comparison table from SolarQuotes presents the majority of battery options currently commercially available. At the time of writing this article, this table is yet to include the Powerwall’s second iteration, however the battery with the closest specs is the Ampetus Energy Pod, with a similar capacity but at a 42% higher price.
While we at PAE try to remain product agnostic, it’s hard to ignore the Powerwall 2 when it promises a 14 kWh capacity, 7 kW peak and 5 kW continuous output – all at an AUD8,000 retail price – according to the Tesla site.
The ability to link nine Powerwall 2 units together means that a possible 126 kWh of energy can be stored at a commercial site for a cost of $72,000. (To put that into perspective, 126 kWh is roughly the amount that four to six Perth households would use each day.) This could be attractive, especially when you consider approximately $25,000 of inverter costs can be avoided – bringing the total cost of the batteries to $47,000.
Site-specific economics
The financial attractiveness is, however, highly dependent on the electricity rate being paid at the site. Where off-peak power can be used (and obtained for <10c/kWh) it may still not make much economic sense to install battery systems for discharge overnight and as such avoid only $4,140* of electricity costs a year.
Of course, if you’re on a flat rate where power is 25c/kWh or higher, the payback periods start dropping into the 4-year range. Now we’re talking!
Time to break free?
But what about when you disconnect from the grid altogether?
Well, let’s have a look at a theoretical residential situation where a significant amount of power is being used (30 kWh per day average optimistically, with 50% used during sunlight hours). In this instance, it would be quite easy to significantly reduce the power bills of this site. In fact, a properly sized PV system of around 3 kW would wipe out the majority of the daylight power consumption, leaving only the ~15 kWh at night being drawn from the grid.
The installation of a single Tesla Powerwall 2 and an additional 3 kW of PV panels could completely eliminate the grid power consumption of the site, in theory.
The problem with that theory is that it assumes that your power consumption aligns perfectly with the generation/charge cycle of your PV system and batteries. In reality, it’s entirely possible that one night you watch a couple of hours more TV, or put the air-con on for an hour extra, and when you get up in the morning at the crack of dawn your coffee machine won’t work and your garage door won’t open because your batteries have no charge left.
When that occurs, you’re really going to wish you still had some grid power to draw on, even if it does cost you 25c per unit.
So the answer then is to oversize the PV and batteries, right? Well, yes, however it doesn’t make much financial sense. Let’s say you add another 2-3 kW of PV and another Powerwall 2. You now have ample power which will ensure that even your peak use days won’t drain your batteries completely. The problem with that is you’ve just spend another $10,000+ for equipment just to satisfy the peak demand times (which may only occur 20-30 times a year). Sure, you’re off grid, but if you’d stayed on the grid you could have used grid power for those 20-30 times a year and maybe cost yourself $30.
Therefore, using solar PV and batteries to eliminate your contribution to grid peak demand, both in a commercial and residential situation, is a win for everyone – but it’s not so easy to cover your baseline demand entirely!
It’s for this reason that keeping a connection to the grid (especially if you’re in suburbia) makes a lot of sense. Reduce the stress you cause the grid, and still access it when you need it.
The future requires both distributed and centralised generation sources, because we will triple our need for electricity if we move to an all-electric economy, one where heating, cooling and transportation rely on electricity. We agree with Mr Musk who sees this future powered one-third by local generation and two-thirds by the grid, but that’s a discussion for another day…
*Assumes 9c/kWh off-peak rate and 1 cycle of the batteries per day
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