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What Tesla's Powerwall Home Energy Storage Battery Means for Texas

By Marita Mirzatuny

Source: flickr/genphys

Source: flickr/genphys

There is enough solar energy potential in Texas to power the world twice over. Yet currently we rank 10th in the nation (behind New Jersey) with 330 megawatts (MW), which is enough to power about 57,000 homes. Texas is a state of almost nine million households. That’s a lot of rooftops, and when you add the number of commercial and industrial rooftops, parking lots, and garages, we are talking about a significant amount of surface area.

Meanwhile, the cost of solar panels has dropped 80 percent since 2008 and prices for rooftop photovoltaic (PV) systems have declined markedly in recent years, dropping 29 percent from 2010 to 2013. Moreover, jobs in the solar industry are booming –SolarCity is hiring significantly more people than leading tech companies like Twitter.

So, what will it take to energize rooftop solar growth in Texas? Well, a recent announcement from one of Texas’ “frenemies” may be part of the solution.

Introducing the Powerwall

Last week, Tesla Motors introduced what many could argue is the holy grail, or the beginning of many holy grails, the Powerwall – a wall-mounted energy storage unit that can hold 10 kilowatt hours of electric energy and deliver an average of 2 kilowatts of power continuously, all for $3,500. Clearly, the market was ripe for such innovation – in the days following the announcement, Tesla took orders worth roughly $800 million in potential revenue.

The criticism that always befalls renewable energy is its “intermittency,” the overused line that “the sun doesn’t always shine and the wind doesn’t always blow.” Well, the game-changing, holy grail to alleviate that problem in good measure is the emergence of scalable, efficient, non-polluting energy storage.

The Powerwall was part of the reason Tesla opened its Gigafactory in Nevada: to scale up and bring down prices for battery manufacturing. Unfortunately, Texas lost out on being the home of the Gigafactory, in large part due to the state’s ban on Tesla’s direct-sales model.

Some are saying the Powerwall isn’t a silver bullet (and I agree) – we have to acknowledge there is always room for improvement. But as we’ve seen with SolarCity and Tesla, market adoption and innovation go hand-in-hand. One drives the other, sparking a windfall of new products and better services that will continue to advance the clean energy economy and give customers more energy choice and independence while bringing costs down.

Coming this summer to a store near you

Tesla founder Elon Musk ultimately sees the home battery becoming as commonplace as the family car. Since the technology is the same, it makes sense to proliferate batteries in both markets. He shares that vision with Treehouse CEO, Jason Ballard, whose Austin-based store (think eco-friendly alternative to Home Depot) is the first retailer chosen to sell the Powerwall. “A home battery could make energy bills an archaic relic of a past system,” Ballard said. “You can now own your own production and storage of the energy you need. This takes us one step closer to completely powering homes without fossil fuels.”

This means Texans can go to Treehouse and purchase a complete solar and battery storage system for their home. If they want the full package, residents can truly catapult to the new energy economy by combining this system with an electric vehicle (possibly the more affordable Tesla Model 3 due out next year) and enrolling in a time-of-use electric rate (where, for example, you may pay less for electricity for using power at night, like charging your car, when wind is blowing).

While Tesla and Texas have a complicated relationship, it is no coincidence Tesla chose Texas-based Treehouse as the first store in the country to sell the Powerwall. Not only is it a progressive business charting the way for sustainable home products, Tesla knows the largest market potential for its home battery is here in sunny Texas.

Due to innovation like Tesla’s Powerwall, all of this is possible not at some distant, utopian point in the future, but this summer.

This commentary originally appeared on EDF’s Texas Clean Air Mattes Blog. 

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Nathan Wilson's picture
Nathan Wilson on May 17, 2015 11:41 pm GMT

nine million households [in Texas]. That’s a lot of rooftops, … a significant amount of surface area.

Meanwhile, the cost of solar panels has dropped…

Yes, that does give rooftop solar an obvious appeal; but dig below the surface, and the alternatives look even better.  The latest quarterly report from the SEIA (a solar trade group) shows that utility-scale solar has remained stubbornly below the cost of residential PV … by a factor of two in cost!  This results from economies of scale, an effect which should apply to batteries as well.

If we broaden the search and include utility wind power (see data from Lawrence Berkeley National Labs 2013 wind market report), we see costs which are 50% lower than even utility solar.  Better yet, in related publications (lbnl-6590ewe also see other effects such as superior capacity factor and long-distance aggregation that allow wind power to supply a much greater fraction of grid demand (40%) without the need for expensive batteries.  Obviously, we can go even further without batteries by utilizing baseload clean energy sources like geothermal and nuclear (which can reduce the need not only for batteries but also for long distance transmission).  For this reason, it makes no sense to consider investing in enough batteries so that solar energy can be used at night; it can be helpful for day/summer-time peaking, but beyond that other solution are better.

It is important to understand that residential solar is only competitive with utility solar because of the disproportionately large subsidies (explicit and hidden) which benefit residential systems.  Our subsidy money will give society a larger clean energy payback if applied in other areas.

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