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Solar Power and Battery Backup: Tesla and SolarCity's Dream Home

Discussion in 'News' started by Citizen-T, Apr 17, 2012.

  1. 3mp_kwh

    3mp_kwh Active Member

    Feb 13, 2013
    The problem I see with this is there are more potential earnings locked up in demonstrating that new plant is needed. Batteries, like distributed grid and demand response, take that earnings stream away. My guess is wide adoption will be super slow, for two reasons. One, we overestimate the savvy of utilities (in recognizing the arbitrage before them). Two, people tend not to reach for long-term savings, through high, up front costs.

    On the corporate side, most utilities see the earnings path through their regulated businesses, meaning away from the operating costs of their generation. Strategy follows the monolithic path of testing regulators, to see what can be passed on. A dollar of legitimized cost, turns into $1.10 of recovery. A dollar of savings? What to do when EIA is saying the sector's growth rate will be just 0.7%/yr? They're challenged.
  2. ItsNotAboutTheMoney

    ItsNotAboutTheMoney Well-Known Member

    Jul 12, 2012
    #62 ItsNotAboutTheMoney, Nov 10, 2014
    Last edited: Nov 10, 2014
    The problem for utilities is that solar and batteries are getting cheaper and consumer solar+battery would completely mess with their model. If they try to keep loading up on generation, they'll just make it more obvious for consumers to switch, and solar leasing companies will happily make it very easy for the consumers. (There are also markets where generation and distribution are (supposedly) separated). A utility that invests in batteries across their grid would have economies of scale that would stop growth in consumer batteries in its tracks, raise generation efficiency, lower emissions, increase renewables, increase grid stability and generally allow them to meet any target government throws at them, with the nice bonus of more capital expenditure that allows them to have more guaranteed profits.

    In fact, cheap static storage could kill residential solar in some locations, as the generators and utilities' ability to meet renewable targets and beat residential solar costs would likely lead to them lobbying away subsidies.
  3. Robert.Boston

    Robert.Boston Model S VIN P01536

    Oct 7, 2011
    Portland, Maine, USA
    #63 Robert.Boston, Nov 10, 2014
    Last edited: Nov 10, 2014
    Southern California Edison just last week contracted for an 85 MW battery storage facility, so I think we're seeing the shift already. The contracts are with Stem, Inc. Interestingly, this is all behind-the-meter storage on customer sites.

    Utilities don't have any incentive to build new generation; their incentive is to increase invested capital that they are allowed to earn regulated rates upon. While power plants have historically been an easy place to make those investments, battery storage is a big capital item, too.

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