Poor economics for batteries at the industrial scale and to power a home
Someday some wizard will develop a chemistry breakthrough that will do for storage of electricity what horizontal drilling and hydraulic fracturing has done for oil and gas production.
In the meantime, the cost for battery storage of electricity is staggering.
5/22/17 – Wall Street Journal – The Race to Build a Better Big Battery – The unreliable intermittent nature of solar power is a massive problem blocking the way of solar being a viable substitute for fossil fuels.
Major efforts are underway to figure out some way to store electricity on an industrial scale.
One cited experiment is being run by Greet Mountain Power. They have a 7,722 panel solar plant which has a theoretical capacity of providing the power to 2,000 homes when the weather conditions are right.
They have installed an industrial grade battery bank in two containers each the size of a tractor-trailer. It can store 3.4 MWh, which is cited as being enough power for 170 homes assuming it was sunny the day before.
Let’s look at the costs.
Cost is $12.8M, consisting of a $0.3M government subsidy and $12.5M of the utility’s money.
The cost per megawatt-hour storage:
- $12.8M – cost
- 3.4 MWh – storage capacity
- $3.76/watt hour
Spread that over 30 years (I think that is an overly generous assumption) at 365 days a year and the cost is $0.34 per kilowatt-hour ($3,760/kWh / 30 years / 365 days ). That is only several times more expensive than what consumers usually pay for electricity. That would be, oh, somewhere around 5 times wholesale prices. Maybe 10 times?
Keep in mind that is an add-on cost after the electricity has been generated.
When someone figures out how to break the barrier in chemistry laws to drop that cost by a factor of 10 or 20, storage of electricity at industrial scale will be viable.
5/22/17 – Wall Street Journal – Home Batteries Aren’t Broadly Economical – Yet – The headline writer is astoundingly optimistic.
Article also doesn’t provide any numbers but says consumers would not save money from using home batteries.
Current costs are running something in this range for a 14 kWh battery according to the article:
- 5,500 – Tesla Powerwall battery
- 700 – hardware
- 2,000 – ball park for installation
- ~8,000 – estimate of total cost
What can one battery do?
Article says one battery would likely not be sufficient to power a home. Article says the Tesla website says one battery would only be enough to run lights and a refrigerator for one day. So that $8,000 would not buy enough storage to also use the air conditioner or washer.
My guess is that would increase my electricity costs of going off-grid by a factor of merely 3 (if I want to sweat out the summers) or 5 (should I not want to melt for about 2 months a year). That doesn’t include the cost of the solar panels. Three or five times as expensive as what I pay today, plus cost of the panels.
Let’s consider the kWh cost of a battery for the home.
If you want your battery to last until the warranty, you can only discharge it about 70%. That means a 13.5 kWh battery can provide about 9.5 kWh a day.
The cycles covered by warranty are 5,000 for the 6.4 kWh model. Let’s assume that is the cycles in the 13.5 battery.
Let’s spread the cost over the warranted cycles:
- ~$8,000 – estimated cost
- 5,000 – assumed warranted cycles
- $1.60 – cost per warranted cycle
- 9.5 kWh – output at 70% to avoid wearing out battery early
- $0.168 – cost per kWh at estimated cost spread over warranted cycles.
A home storage battery will add 16.8 cents to the cost per kilowatt-hour.
By the way, my calculation matches the 17 cent cost per warranted kWh in the cited article quoted in the Wikipedia article.
The cost of storage of electricity is more than the average price paid by consumers in the US, based on the comments in the article. Don’t forget to add in the cost of the solar panels or the cost of electricity purchased overnight to recharge the battery.
Yeah, batteries for home storage of electricity are not economical.
Average cost of electricity for consumers
Article says average cost is $0.1282/ kWh for US homeowners – 12.8 cents a kilowatt-hour. That is according to the EIA.
Rates around the world for 1 kWh:
- 29.7 – Germany
- 24.1 – Italy
- 19.5 – U.K.