Solar Batteries, add now or later?

Solar Batteries

With the recent California wildfires, the threat of grid blackouts and brownouts is more apparent than ever and interest in solar batteries is trending upwards. Add to that Investor-Owned utilities Like SCE, SDGE and PGE are changing over to new (TOU) Time of Use electric rates. Solar Customers are ready to play the game of pushing and pulling power to leverage these rates in their favor and like the idea of having their own energy storage for any potential grid disruptions.


The question is should you install a battery now or add it later?

As with any major purchase (a battery can add 10-14K to a solar project) you want to compare the benefits to the cost. If these benefits aren’t compelling enough to justify the cost, then that means you should probably wait for battery cost and capabilities to improve to a point when it makes sense for you. If you think you will eventually add a battery you can ask your solar installer to make sure your solar system is storage ready to avoid any headaches down the road. Adding a battery later isn’t complicated but it certainly can be if the proper hardware and electrical are not installed to be storage ready.

Benefits
  • Will save you money, by storing your own energy in a battery you can avoid pulling electricity during the most expensive (TOU) Time of Use Rates.
  • Resiliency, if you’re concerned about grid disruptions in your area a battery backup will make sure that you can keep the lights on and food cold. Batteries may not save you much more than solar without a battery but for some you can’t put a price on peace of mind.   
  • Tax Credits and SGIP in California (Self Generation Incentive Program) if you include a battery as part of your solar project you can claim 26% of the total project cost and batteries are eligible to participate in California’s SGIP program.

What’s the latest with SGIP incentive program?

In January 2020, the CPUC approved additional funding for SGIP. The approval provided an additional $675 million for the program and extended it until 2024. That means there is over $1 billion in incentives available through SGIP. The sooner you apply for SGIP, the greater the rebate you’ll receive. This is because SGIP has a tiered rate structure, which means the SGIP incentive amount decreases as more batteries are installed. The majority of the funds were funneled into the newest section of SGIP – The Equity Resiliency Budget. The Equity Resiliency Budget was created in response to the increase of wildfires and Public Safety Power Shutoffs (PSPS) (AKA planned power outages) throughout California.

To qualify for the equity resiliency budget, a customer must:

  • Be considered a low-income customer
  • Live in a Tier 3 or Tier 4 fire risk area
  • Live in an area that has experienced two or more PSPS events
  • Be a critical facility that services a disadvantaged community, high fire risk area, or PSPS-affected area 

Energy storage projects that meet these criteria will receive a substantial SGIP incentive of $1,000 per kWh of battery storage installed. This increased rebate rate is believed to increase access to battery storage for the most vulnerable customers by covering almost the entire cost of installing battery storage.  The new budget also allocated about $60 million to regular residential projects. This has allowed SGIP to extend beyond its original “five step” design. Now, the SGIP residential program is in Step 6, with an incentive level of $200 per kWh of solar battery storage installed.

How much can you save on a battery storage system with SGIP?

Making the decision to install a battery storage system in your home can be an expensive investment. SGIP can help soften the blow of the upfront installation costs of installing a battery. As of January 2021, residential customers will receive $200 per kilowatt hour (kWh) of energy storage they install. That means a 10 kWh solar battery would qualify for a $2,000 rebate! The price of installation will be even lower when you take the 26% investment tax credit (ITC) into account.

If none of these benefits outweigh the cost for you that’s ok, it means you should probably wait to install a battery. If a battery backup is still on your wish list, read on! We will cover the 2 most popular options and 1 emerging technology that may be a future market leader that’s available today.

Tesla Powerwall

Tesla Powerwall is by far the most popular solar battery option on the market. The downside to Tesla is that you have to pair it with a Tesla Compatible Solar System. So, if you have an existing solar system you can’t add a Tesla Powerwall. It also means if you want Tesla Powerwall you have to deal direct with Tesla or Limited Authorized Dealer Network. Tesla hasn’t had the best track record with long term customer service if you read their customer reviews. You have to deal directly with Tesla or limited list of Tesla Approved Dealers verses other options that are more widely available. That said, the Tesla Solar+Battery technology is impressive and low maintenance. It would be our number one pick but since it’s not compatible with preexisting systems and has no off-grid capabilities it just doesn’t achieve the storage goals of most our customers that are shopping for a battery. (Solvable problems I’m sure Tesla is working on) If you want a complete solar+battery system Tesla is still the leading option available today! 

Pros 

  • Complete Home Solution – Tesla Solar+Powerwall 
  • Long Life Cycle and Expandable 
  • High Efficiency 90% Round Trip

Cons

  • Not Compatible with Most Pre-Existing Solar Systems
  • No Off Grid Capabilities (Coming Soon according to Tesla)
  • Limited Options – Must deal directly with Tesla or Authorized Dealer
LG Chem RESU

The LG Chem RESU is a lithium-ion solar battery similar to Tesla Technology. There are different models to choose from, depending on the solar inverter you choose. Plus, the LG CHEM RESU can be used for completely off-grid solar installations. The compatibility of LG is a huge advantage for homeowners. Unlike the Powerwall, which now requires you to install a Tesla solar panel system and Tesla inverter, the LG Chem allows for better customization of your solar-plus-storage system. Another benefit of the LG Chem is that it is charged directly with the DC power produced by your solar panels, making it more efficient. 

However, the RESU isn’t able to hold as much power and has a shorter lifespan than Tesla is predicted. We say predicted since most solar battery systems haven’t been in operation for the lifespan of their warranties. Both LG and Tesla are strong companies that should honor the 10yr warranties they offer. If you do end up needing to process a warranty claim that may be a good thing if you get a fresh battery before the warranty runs out. 

Pros

  • Compatibility for New and Pre-existing Solar Systems
  • Widely Available 
  • Off Grid Capabilities and Expandable

Cons

  • Smaller Capacity 
  • Shorter Lifespan 
  • No Solar Tax credit if Added later
NeoVolta

NeoVolta’s NV14 is the first Lithium Iron Energy Storage System to be approved by the California Energy Commission. It seamlessly powers up to 16 breakers and 32 amps of continuous power through peak rates or grid outages. Connect to DC solar installations without any external inverters or to AC solar installations via String or Micro Inverter. The rapid auto transfer switch, ensures that even when the grid goes down, power remains uninterrupted. 

The capabilities of the NeoVolta may challenge Teslas dominance but they are still growing their installation Network. We found 4 approved installers in California currently. They are just scratching the surface of the massive storage market. Definitely a company we think is one to watch if they can get their operation to scale for the masses. 

Pros

  • Compatibility for New and Pre-existing Solar Systems
  • High efficiency of 94% and Safety (Non-Combustible)
  • Off Grid Capabilities and Expandable 

Cons

  • Limited Availability 
  • Small Dealer Network (not available in all areas)
  • No Solar Tax credit if Added later

Finding the right Chemistry that produce superior cost, capabilities and safety is the holy grail of the storage market. The company that figures out the right chemistry will more than likely dominate the market. Tesla and LG Chem currently dominate the U.S. home battery market. Both use the lithium-nickel-manganese-cobalt-oxide (NMC) chemistry favored by the electric vehicle industry. In cars, the goal is to pack as much energy into as little space as possible. That comes with a tradeoff: the potential for cells to heat up and kick off a chain reaction that can end with fire and in enclosed spaces or worst case explosion. Remember the Samsung Cell Phone recall of exploding phones. Same technology just larger scale. Such calamities are extremely rare, but safety has become a major focus in the emerging energy storage market. NeoVolta is engineered for safety using Iron not Ion. Neovolta boast higher efficiency than tesla by 4% and has comparable capacity and 10yr warranty. At this point in time if you can get your hands on one NeoVolta has the edge on efficiency, safety, can go off grid and can be customized for new and existing solar systems. Solar batteries are not for everyone yet, cost is still too high for most solar customers but there may come a day when every home has energy storage. For now, if you have a critical need for power or live in an area that is prone to blackouts it’s a perfect solution. If you would like to learn more about any of the options listed, please submit your energy evaluation and we can help guide you to the best options available in your area. We look forward to speaking with you, thanks for reading! 



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Written By Dan Nachreiner Founder Flex Advisers

Sources Tesla, LG, NeoVolta, Solarreviews, Energysage, Greentech Media