This article was originally posted on LinkedIn, where there are other comments. Reproduced here with permission.
We note it was also posted here on One Step Off The Grid on 13th August, where there is another stream of comments.
In April last year my partner Hannah and I moved into our new home – a beautifully renovated Queenslander in inner-Brisbane. Having lived in apartments before this we were excited by the new opportunities for sustainability improvements – particularly a home battery + solar system. The timing worked out perfectly and we were lucky enough to be eligible for the Queensland Government’s Interest Free Loans and Grants Program for Solar & Storage. This meant a $3,000 grant towards the upfront cost, as well as a $10,000 loan to be paid back interest-free over ten years ($83.33 per month, for those wondering). The system was installed over a couple of consecutive days and commissioned on 8 August 2019 – meaning it just recently celebrated its first birthday.
The goal was to be as self-reliant with our own renewable energy as possible – directly consuming solar generation during the day and charging the battery for use overnight. On this metric we’re pretty happy with the result – achieving 92.2% self-sufficiency over the year.
The Tesla monitoring platform provides so much more data than just the headline figures though, so as a self-confessed energy and data geek I decided to delve in and do some analysis on how the system performed technically and financially over the year. The results will hopefully be of interest to fellow energy obsessives, as well as those who may be considering the merits of home solar + storage.
Before diving into the data, a snapshot of the system specifications:
- Tesla Powerwall 2 battery – 5 kW / 13.5 kWh
- 20x SunPower P19 315 W modules – 6.3 kWp
- 20x SolarEdge P320 power optimisers
- SolarEdge HD-Wave single-phase inverter – 5 kWac
- SolarEdge Immersion Hot Water Heater Controller – 3.6 kWac
The addition of the SolarEdge Immersion Hot Water Heater Controller is of note – I’ve long been an advocate that most solar households are sitting on top of the best battery there is and just don’t know it – their hot water system. The SolarEdge Immersion Controller is a smart device designed to dynamically divert excess PV into water heating instead of grid export. I experienced issues with it in our particular application, however, as the Powerwall and the Immersion Controller can ‘fight’ each other to decide where excess PV is first diverted to. I subsequently disabled this function, and now use it as a simple wifi-controlled timer instead. This is one area cost saving could be achieved if doing it again.
Power flows and energy balance
So what does all this look across on a typical day? Figure 1 provides an annotated example from 15 July this year, demonstrating how the solar + battery work together to enable complete self-sufficiency on this particular day. Grid imports are only required in scenarios where the battery runs empty.
Figure 1: Site power flows on 15 July 2020
Looking across the year, power flows to and from the various aspects of the system are illustrated in Figure 2, with the relevant kWh totals making up the overall energy balance noted.
Figure 2: Energy balance across the year
At the highest level, the solar system generated 7,834 kWh (4.29 kWh per kWac per day) compared to household consumption that totalled 5,092 kWh. This works out at 13.92 kWh per day – slightly higher than the local average of 13.4 kWh per day for a two person household without a pool (according to Energy Made Easy).
Diving deeper, it’s interesting to look at the proportionate splits between energy sources and destinations. The left-hand side of Figure 3 shows home energy consumption by source, with solar-self consumption and Powerwall discharge being pretty well equal, and the balance supplied by grid imports. The right-hand side of Figure 3 shows the destination of solar generation, with a pretty much equal three way split between direct home consumption, battery charging, and grid export.
Figure 3: Proportionate breakdowns of energy source and destination
The finding that 35% of solar energy is being exported to the grid was higher than I had expected, particularly due to a very conscious effort on our behalf to self-consume as much as possible (both through the hot water controller, as well as timing the dishwasher, washing machine etc.). More importantly, this alludes to the single largest issue with the system’s performance – the disparity of solar generation between seasons and its impact on renewable self-sufficiency. In short, we have too much solar in summer and not enough in winter. This is illustrated by Figure 4.
Figure 4: Source of household energy supply by month
This clearly shows the large discrepancy that exists between renewable self-sufficiency in Spring and Summer compared to the tail end of Autumn and through Winter (noting figures for Aug 19 and Aug 20 are part months). November and January were tied for the best result, with 99.3% self-sufficiency, whilst June had the worst outcome with only 74.9% self-sufficiency. This is primarily explained by lower irradiance in the winter months, but more specifically the fact that our PV system is orientated towards the south-east for various reasons. In short this equates to pretty poor winter performance, with maximum daily yields around only 14 kWh, even on cloudless days.
Observations about system sizing
With all of the above in mind the question can be asked – is our battery the right size? That question can at least partially be answered by calculating its ‘utilisation factor’ – that is, on average over the year, what portion of the battery’s storage capacity was discharged each day? The answer is 6.21 kWh – or 46% when comparing against nameplate capacity of 13.5 kWh.
At first glance this would imply the battery is oversized for our circumstances. Furthermore, the prolonged instances where grid import was high (i.e. winter) were driven by a lack of sufficient solar generation to fully charge the battery, rather than the battery running empty because it didn’t have enough capacity compared to load. Without going overboard and running half hourly simulations, my gut feeling is that a nameplate capacity of around 10 kWh would be the ‘sweet spot’ for our current circumstances. But considering potential future growth in household consumption, as well as capacity degradation over the battery life, I’m ultimately glad to have the 13.5 kWh of the Powerwall 2. If I was to make any change it would be to add more PV capacity to help with generation shortfalls during winter. This, however, is complicated by current regulations in the Energex network around both PV inverter and battery inverter nameplates counting towards connection limits – a topic for deeper exploration another day!
Technical & backup performance
The data shows that the battery had an overall round-trip efficiency of 86.5%. This compares to a stated efficiency from Tesla of 90%, with no obvious explanation for the shortfall that I can think of considering the battery’s location was largely shaded throughout the year.
Figure 5: The system in backup mode
The final area of I want to cover before getting to the dollars is backup performance. This is one area where the Powerwall really excels. In testing I found it to effectively function as a quasi-UPS, with barely a flicker of the lights in the transition between on and off the grid. According to the Tesla app there were 13 backup events totalling 30 minutes between October and February. I question how many of these were ‘genuine’ blackouts versus flickers in power quality that triggered the Powerwall to enter back up mode. Nonetheless I certainly haven’t had to reset the oven clock since the system was commissioned! It’s yet to be truly tested during a sustained grid outage due to a storm or similar, but I’m a firm believer that this is an area where home batteries can very quickly deliver immeasurable value to their owners.
Speaking of value, it’s time to dive into the financials – the main topic everyone wants to talk about when it comes to batteries!
In terms of capital cost, the overall system totalled $21,000 (inc. GST) after the value of the solar STCs are taken into account. Valued individually, the solar system + hot water controller are worth roughly $8,000 ($1.27/Wp) of this, and the battery around $13,000 ($963/kWh). Thanks to the $3,000 grant, the net cost of the system to us was $18,000, with an upfront cost of $8,000 after factoring in the interest free loan.
To assess the cost savings provided by our system, the real data from the past year can be used to compare competing scenarios. These utilise Powershop’s pricing for the Energex network area and figures are inclusive of GST. Figure 6 calculates our annual energy bill under three scenarios – grid only; solar + hot water controller only; and solar + hot water controller + battery. It’s important to note that these figures are specific to our circumstances, and mileage will vary depending on your specific annual energy consumption and tariffs.
Figure 6: Annual energy cost outcomes for various scenarios
According to this analysis, a solar only scenario would have delivered a 67% saving compared to grid power alone, with the solar+ battery scenario delivering an overall 86% saving vs. grid power, and a net cost less than half of the solar only scenario.
Using a capex value of $8,000, a payback period of 7.2 years (or 14.2% pa. return) would be expected for the solar only scenario. Using the $18,000 net cost of the solar + battery system, a 12.5 year payback period (or 8% pa. return) is estimated. This compares to the Powerwall 2 warranty of 10 years, noting that it is expected the system will still function after this point. These values come with the usual caveat that they are based on a snapshot in time of one year’s results only.
So does this represent a good investment decision? That will be a matter of your personal goals and perspectives. As someone passionate about clean energy and who enjoys being an early adopter, I’m a happy customer with no regrets. There is something immensely satisfying about checking my phone app and seeing that we’re self-powered, day and night. I also believe the back-up functionality will at some point in the future come into its own. The ability to run self-sufficiently for days on end while the rest of the neighbourhood is in the dark is invaluable, as those in the southern states learnt last summer.
With all that being said, it’s not an investment we would have made without the generous support from the Queensland Government in the form of the grant + interest free loan. With a state election looming, I wonder whether we will see something similar again soon for those who missed out the first time?
For the residential battery market to really take off, I believe three key things are required:
- Capital costs have to come down. Based on the trends I’m seeing at commercial and utility scales, this can’t be far away from translating to the residential market, and is especially promising if the industry can develop scale and efficiencies like Australia has done so well for rooftop PV.
- Tariffs need to be reformed. It’s not contentious to predict that over the medium term the value of solar feed-in will reduce. Today however, many residential retail offerings have artificially inflated solar feed-in tariffs as a form of product differentiation and customer attraction. This distorts the case for both increased solar self-consumption as well as battery storage. This trend will ultimately have to correct, and indeed Powershop (my retailer) has recently cut their feed-in tariff by more than a third year-on-year, from 9.5 c/kWh to 6 c/kWh . At the same time though, fixed daily supply charges have gone up. For residential batteries to make sense, reasonable daily supply charges, true cost reflective feed-in tariffs, and an increased move towards time-of-use tariffs that better reflect underlying market dynamics are all required.
- The ability for average users to be able to discharge surplus stored energy into the grid needs to become more widely accessible, including to those outside of VPPs. This isn’t currently possible in my circumstances, despite the data showing I am using less than half the battery’s nameplate capacity each day. If I was able to discharge say a spare 4 kWh daily into the evening peak, even if only valued at a flat tariff of 25c per kWh, this would add a further $365 of value each year, and push payback to under 10 years. Not to mention the exciting possibilities to geek out further by potentially trading the spot market at home!
So what do you think? Has this changed your understanding or opinion of home solar + storage? Are there any questions about things I haven’t covered? Leave a comment and let me know!
About our Guest Author
|Andrew Wilson heads corporate energy & sustainability at The University of Queensland (UQ) and is Project Director of the 64 megawatt Warwick Solar Farm. He and his team are leading a world first initiative for UQ to become a 100% renewable ‘Gensumer’ – playing on both sides of the energy market as a large energy generator and large energy consumer, utilising energy storage and demand response to help deliver UQ’s operational energy needs in a flexible, sustainable, and lowest cost manner.
At a larger scale, Andrew and his team recently published a deep dive analysis into the performance of the 1.11 MW / 2.15 MWh St Lucia Tesla Powerpack – the largest behind-the-meter battery in Queensland. Click here for more information.