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Too slow and steady: household battery packs are going to take a while October 25, 2014

Posted by Maury Markowitz in power grid.
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That can't be good.

That can’t be good.

I would like nothing more than to have an inverter and battery pack in my home.

The recent ice storms left us without power for just over three days in the dead of winter. We had a gas stove in the basement and some great camp lights that kept us going, but camping in your own basement without any form of communications gets boring fast. I’d love to have backup power, but at something north of $15k, I have other things to worry about.

So it’s with some sadness that I saw recent numbers from Sandia Labs that suggest I’m going to have to keep waiting a while before I can actually afford a whole-home UPS (uninterruptible power supply), but not for the reasons I thought.

It seems Sandia agrees with my thinking on one point; the only practical technology for any sort of whole-home backup is li-ion. Lead-acid is cheap, but requires constant maintenance, take up a whole lot of room, last only so many years, and are filled with lead and acid. Li-ion is roughly three times in all of those measures – they’re three times smaller and lighter, three times as tough, last about three times as long, and, sadly, cost about three times as much.

Electric cars had the potential to seriously upset that last item. Greater production will drive down the prices, which is the whole idea behind the Tesla “gigafactory”. But additionally, a used car battery makes a perfectly reasonable home battery. Batteries lose their capability primarily by being more difficult to charge at reasonable rates, which isn’t the same scale of problem for a backup supply. So, in theory, when these first generation cars wear out in about 10 years, we should see a huge supply of semi-useful batteries hit the market.

But, as it turns out, that’s not the problem. Let’s get right to it, here’s the chart:

Batteries are not the problem.

According to this projection, in the next ten years the price of a watt-hour of storage in li-ion is going to fall from the current ~42 cents to about 20. This is in-line with other projections I’ve seen. For reference, the battery pack in the Tesla is 85 kWh and costs about $35,000 to replace, so that’s 41 cents, right in line with these numbers.

Well you can see the problem. Even as the price of the batteries falls to the point where they are not really an issue any more, the price of the inverter/charger grows to be an ever-larger proportion of the overall cost. They’re predicting the total UPS system will be on the order of 75 cents a watt-hour in 2025.

To put that in perspective, my home burns about 10 kWh/day, about half the Canadian average – gas stove, hot water and drier, all-LED lighting, new low-energy computers is about all it takes to do that. So if I wanted three days of backup, I’d need 30 kWh of storage, which would cost me about $22,500. If I add panels to the mix, which might cost $3000 in this case (already have the inverter) I might get away with two days of backup, so $18,000 in total. Still way out of my league.

There is a little good news here. If I did have an electric car, in theory that could be my storage. A Tesla S has eight days of storage at my use level, so all I’d need is the inverter and maybe some panels. Tesla doesn’t back-feed though, although the Toyota Prius does, but that’s only 4.4 kWh, and the car I want, the Ford Fusion Energi, has a 7.6 kWh pack. Maybe good for the next ice storm, but certainly not something to rely on for day-to-day.

The other thing to note is that I suspect their projections on the electronics side of things are highly conservative. Inverter prices are *plummeting* right now, due largely to the Chinese turning their attention from the panel side of things to the electronics. Typical 3.5kW inverters ran about 50 to 60 cents/watt in 2012, but they’re falling into the 30 cent range now. DC-battery inverters cost more now, but there’s really no reason for this other than the market being smaller. We’ll see if there’s any bleed-over effect.

So there’s the scoop! I will, of course, be watching this closely over the next couple of years, as will much of the RE market. A good product to sell into the home, especially one that matches so nicely with PV, is something everyone’s been waiting for.

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