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Comment by Andrew Wilson on September 7, 2021

It has been more than two years since our home solar and battery systems were put into use, so I would like to study the data in depth to see how it performs.

This article will mainly focus on the performance of the system in the second year. Here is a detailed analysis of year 1 performance as well as more information and background about the system itself.

The self-sufficiency rate in the second year was 89.8%. This is 2.4% lower than the target achieved in year 1, which is driven by a series of factors discussed further in the next section.

Other key data for year 2 (and their comparison with year 1) are as follows:

– Battery round-trip efficiency = 88.7% (increased from 85.7%)

– Household consumption = 6,258 kWh (up from 5,095 kWh)

– Solar power generation = 7,456 kWh (less than 7,825 kWh)

– Grid input = 638 kWh (previously 397 kWh)

– Grid output = 1,509 (less than 2,747 kWh)

The biggest surprise at the beginning of the second year's data was the substantial increase in household consumption-an increase of 23% over the previous year. This can be largely attributed to the increase in work from home in the summer and the urgently needed air-conditioning equipment in the home office.

This increase in consumption has had a significant impact on self-sufficiency, with an average self-sufficiency rate of 92.8% from November to March in the second year, compared with 98.8% in the first year. In fact, the lower self-sufficiency rate in these summer months is the only reason that slows down economic growth. The results are lower than the annual results, and the remaining months are roughly in line with the first year's figures. A summary of household energy supply by month is shown below.

The increase in household consumption has also had a significant impact on the role of solar energy in the energy structure. In the second year, nearly 80% of solar power is either consumed directly or used to charge batteries. This is a big leap from the first year, when only 65% ​​of solar energy was used in this way.

This had the effect of a substantial reduction in the amount of solar power output to the grid, which was almost halved between the first and second year. It is worth noting that the overall solar power generation has also fallen by less than 5%. Without any detailed analysis, my intuition is that this is due to what feels like a wet year, although it is expected to be slightly affected by the degradation.

Taking into account the trend of sharp decline in feed-in tariffs, the increase in solar self-use and the decrease in grid exports can be seen as a positive result. It is also positive to see the battery utilization rate (measured by the average daily discharge as a percentage of the nameplate capacity) increasing by more than 6% year-on-year.

However, this trend may cause a problem, because our family hopes to add an electric vehicle (EV) before the end of the year, and hope to use the excess solar energy at home to complete most of the charging.

The second year's data has been used to look at the amount of "fuel" available for electric vehicles in the future-some worrying results have been found. For the purpose of this analysis, we have made some key assumptions and simplifications-driving 15,000 kilometers per year (average distribution per month), EV consumption per kilometer of 150Wh, and 15% energy loss through AC charging.

This found that we need an average of 221 kWh of surplus solar energy per month to fuel electric vehicles, while the current average monthly requirement is 125 kWh-less than 60% of what we need. If you look at this equation on a monthly basis (as shown in Figure 4 below), there will be a large surplus in October and November, and there will be no surplus in June and July, and the situation will get worse.

The results of this analysis are surprising and emphasize the need to try to solve this problem before the arrival of electric vehicles. Options under consideration include increasing the DC capacity of the solar system to the inverter OEM limit, or upgrading to a three-phase power supply to enable a larger photovoltaic system.

Each of these has many technical and cost considerations to consider-watch this space for future articles! Even with a larger photovoltaic system, this highlights the fact that some degree of "from the grid" household electric car charging may be required.

Now on my to-do list, studying the best products currently provided by electricity retailers for this purpose, which is also expected to incentivize the use of excess solar energy (only from our neighbors, not us).

Compared to year 1 (85.7%), the round-trip efficiency in year 2 (88.7%) is significantly improved, which is a bit surprising considering that landscape changes mean that the battery now receives more direct morning sunlight than before. This number is still below the 90% value specified by Tesla, although it is worth noting that the calculation method is as simple as energy output divided by energy, and it is difficult to measure under standard test conditions.

In the second year, the battery tested its backup function for the first time on May 25, 2021, when the incident at the Callide C power station plunged nearly 500,000 customers in Queensland into darkness. In our house, the power outage lasted for 57 minutes, and Powerwall performed perfectly during this period-in fact, apart from the notifications sent to my phone, you can't tell if a power outage occurred at all.

My view remains that this kind of backup function is one of the killer selling points of household batteries and can help them bridge the "return gap" they currently face. Faced with the increase in inclement weather and the increase in work-at-home rates, more and more families may begin to value the reliability of the supply they can provide.

Interestingly, our neighbors also have a home battery system and are disappointed in directly understanding the difference between whole-house backup and only basic circuits. This is a key selling point of Powerwall 2 products, and any serious battery OEM needs to include it in their products.

In my conversations over the past year, interest in household battery economics is still strong and growing. Spoiler alert-the performance of our system in the past year has not revealed a purely financial case for home storage. Although the price of utility scale continues, the initial cost does not seem to have changed much. In fact, Tesla has increased the price of Powerwall 2 in many markets, mainly in response to the strong demand after the main US grid is interrupted and the supply chain is restricted.

Using actual data and retail rates, we can compare our home energy cost with the net cost of solar + battery, and view it under a business as usual (BAU) scenario (no solar or battery). In order to evaluate this in context, the cumulative cost per month can be calculated and compared, as shown in Figure 5. This finds that the savings to date under the solar + battery solution are approximately US$2,700. Extrapolation (I don't recommend doing it in isolation-see below) provides a 13-year return on investment for a solar + battery system costing $18,000.

As we all know, the above analysis combines the advantages of solar and batteries-this reflects the fact that we invest the two as a package. The marginal benefits of adding batteries to existing solar systems are still limited. To change this situation, the previous price needs to fall, and the "price gap" between the import and export value of the power grid needs to increase substantially.

The latter has undergone some changes, as shown in Figure 6, which shows my retailer (Powershop)’s feed-in tariff and anytime consumer tariff in the past three years. Although overall energy prices have fallen, feed-in tariffs have fallen by nearly two-thirds during this time, and the price differential that can benefit batteries has increased to US$165/MWh in the current fiscal year.

As feed-in tariffs may approach zero in the next few years, this may begin to affect the idea of ​​solar homes. For many homes, grid exports account for a considerable part of the financial equation of their photovoltaic systems.

In our case, despite deliberate efforts to maximize self-consumption of solar energy, without batteries, almost 60% of solar power generation in the past year will be output to the grid. This was worth $420 in FY20, but today it's worth only $150, and it's still declining.

After two full years of operation, our investment in household solar + battery systems is still something we are satisfied with. For most people, the cold financial situation is still unsatisfactory, but the satisfaction of maximizing self-sufficiency still exists.

The intangible but substantial value of the backup function is also beginning to come into play, and may continue to play a role in the next few years. With the upcoming addition of electric vehicles to the portfolio and the impact of rapidly falling feed-in tariffs, please stay tuned for the report card for the third year!

Andrew Wilson is a director of KPMG's energy infrastructure team. He has deep expertise in renewable energy projects and energy markets, and has extensive experience in all stages of the energy infrastructure life cycle (from feasibility and development to construction and operation). Andrew is passionate about leading change and solving the complex challenges of the energy transition.

The views expressed in this article are his own and do not necessarily represent the views of KPMG.

This article was originally published on LinkedIn. Reprinted here with permission.

Submitted as follows: battery/storage, electric vehicle, specialty, solar, tariff

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