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Glimpsing into the Emerging Market of Home Energy Storage

By Sarah Peters

At last December’s UN Climate Change Conference (COP 21), the USA set ambitious goals to cut carbon emissions and to invest in clean energy. One of the ways that we will reach those goals is through renewable energy technology. And already, we can see industry and policy pushing forward.

Meeting the current challenge

When I say “renewable energy” you probably imagine this:

renewables

Renewable energy sources such as solar and wind are inconsistent; on sunny or windy days, they produce more energy than the grid demands. The primary challenge is how to store that extra energy efficiently for use during windless nights and sunless days.

Currently, the most common and cheapest way to store energy is pumped hydro. Here is how it works:

Water is pumped from a low elevation reservoir to a high elevation reservoir during peak energy production. When renewable sources are not meeting the energy demand, water falls from the higher reservoir, spinning a turbine to generate electricity.

PumpedHydro

Although pumped hydro stands at 99% of global bulk energy storage, it is clearly impractical for residential use.

Innovating a better battery

When I think of renewable energy, I think about this: 

TeslaPowerWall

Rechargeable lithium-ion batteries are one option for storing energy in the home. In the past, this option was impractical due to high cost.

However, in recent years lithium-ion batteries have become more attractive as prices fall, which has driven further private sector innovation. A Deutsche Bank report estimates that lithium-ion battery prices could fall by 20-30% a year, becoming cost-competitive with traditional batteries by 2022.

This has heated up international competition to build the best home energy storage options.

  1. Tesla got into the game with the 2015 launch of Powerwall, a rechargeable lithium-ion battery for residential use.

  2. Another top innovator is the German company Sonnen. They began combining solar with energy storage and digital controls – this allows consumers to house their own microgrid.

  3. Finally, there is Australian company Origin Energy’s combined solar and storage system.

Using the infrastructure that we already have

Electric water heaters are essentially pre-installed thermal batteries that are sitting idle in homes across the U.S. – the Brattle Group

Another potential form of energy storage harnesses the storage potential of a common household appliance – the water heater. Using

water heater tanks as thermal energy batteries can reduce communities’ environmental footprints and electricity costs by storing excess energy for use during higher-priced peak periods.

An energy cooperative began testing this concept in February, launched in Minnesota by Great River Energy, the Natural Resources Defense Council, the National Rural Electric Cooperative Association (NRECA), and the Peak Load Management Alliance (PLMA).

“When the wind is blowing or the sun is shining, large capacity water heaters can make immediate use of that energy to heat water to high temperatures. The water heaters can be shut down when renewables are scarce and wholesale costs are high,” explains Gary Connett of Great River Energy.

By controlling the water heaters of 65,000 participants, Great River Energy has managed to store a gigawatt-hour of energy every night.

With political will, there is a way

Adopting home energy storage will only happen where it makes economic sense. Chances are, the leaders will be in regions with supportive policies.

One such policy is called net metering, which is a billing policy where utility companies pay residential and commercial customers for the excess renewable energy generated at home. Early adopters include Germany, Australia, as well as a few U.S. States: California, Oregon and New York.

Daily_net_metering

As renewable grid-connected resources mature, it is likely that more governments, regulators and utilities will enact their own incentives for energy storage. The momentum is growing.

Moving forward in this emerging market, a combination of economic and political forces will determine where and how residential energy storage flourishes.

Sarah Peters graduated from Gettysburg College in 2010 with a B.A. in Environmental Studies. She has written articles and blog posts for the Wilderness Society, Maryland Sierra Club, and DC EcoWomen. She volunteers for the Wilderness Society while seeking her next career opportunity.

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