Is a solar powered grid about to become a reality?

+ The combination of solar panels and affordable home battery storage is enticing, but are the economics aligned for mass adoption?

For decades solar power has held out the tantalising prospect of a plentiful, free power source. But the challenge of power loss on cloudy days has traditionally left us reliant on a carbon-burning power grid and all the costs that go with it. However, affordable storage for solar might be about to make a solar-grid possible after all. 

Australia, a sun-drenched nation, is unsurprisingly a global crèche for new and emerging solar and battery technologies. Experience there teaches us a valuable lesson about the interdependency of new technology and the existing economics of the established energy business.

Throughout the 2000s Australian electricity consumption at both a household and industrial level underwent a meteoric rise, and Network Service Providers embarked on capital programmes to meet the rising demand of power-hungry consumers. But consumption growth suddenly fell, and continued to taper over the past five years. What happened?

The drop resulted from a perfect storm of factors: more efficient home appliances and lighting, widespread insulation and rooftop photovoltaic panel installation, improved heating, cooling and water efficiency in new homes, in-home demand-side management systems, and the Australia-wide shift from manufacturing to service industries – manufacturing requiring greater amounts of energy than services.  

So, what are we left with? A grid with excess capacity for our current needs, but one whose expansion has had to be paid for through electricity bills. Worrying for the power generators, all the consumer hype is about ending bills entirely through a switch to solar panels and home batteries. In this new self-sufficient world, you simply put a battery system like Tesla PowerWall in your home, pair it with a photovoltaic system on your roof, and see an end to electricity bills, possibly even earning money by selling excess power back to the grid.

So does the self-sufficient vision promise a free-power revolution that threatens our entire existing grid? Yes and no. The grid still matters. Indeed, as regions transition to renewable energy generation, the importance of the grid’s ability to supply energy between sub-regions, at different times, will only grow in importance. Renewable energy needs a grid to transport energy from one sub-region to another since some regions will have cloud cover or no wind while others will have both those in high supply.

And for now the economics of solar don’t quite add up. The Alternative Energy Association’s recent Household Battery Analysis report examined ten scenarios and found household batteries and PV pairings won’t be economic for the average household until 2020. The Grattan Institute compared the costs of storage and PV pairings against a fully grid-connected household and found the solar-plus-home-power-battery system to be the significantly more expensive option. Plus there are diminishing returns to adding solar and leaving the grid: Grattan estimate it costs $34,200 for 95% reliability off-grid, $52,000 for 99% and $72,200 for a system to supply 99.9% off-grid reliability compared to $12,910 for a traditional grid connection.

However, engineers, economists and scientists have a tendency to be pessimistic in their forecasts for existing technologies. The lesson from a solar-soaked Australia, with a population rich enough to afford expensive storage solutions, must surely be that change is coming, and probably sooner than many of the pundits might think.

How do you think designers might speed up the transition to a self-sufficient world for energy?