LONDON—Roof-top solar can be a critical way to meet new carbon-emissions standards, but unsubsidised payback periods are still too long and, by and large, home-solar systems still lack a cost-effective means of enabling households to use as much of their home generation as possible.
Ultimately, batteries almost certainly will become a critical part of home solar systems, allowing home owners to store solar until they need it, including after sunset. But they are still costly for residential applications. So, in the meantime, are there cheaper, alternative devices available.
I attended one of Europe’s bigger energy technology conferences this month, European Utility Week, and was surprised, first by how few “smart home” vendors could optimise home solar systems, and second, how expensive the few available options were.
In a post-renewables-subsidies world, households have to maximise self-consumption rates, meaning they must use as much of their home solar generation as possible for themselves, rather than export that power to the grid.
You can maximise home solar by running appliances or heating water while the sun is shining. The ideal solution: A smart device that automatically runs a scenario chosen by the user to eliminate exports to the grid. Such a scenario could charge a battery first, if there is one, and then, say, heat water via an immersion heater or electric heat pump, and once the maximum possible electricity is stored in the battery or as hot water, run appliances such as washing machines.
Governments have many ways to drive modernization.
At the Utility Week market fair, I approached 13 companies that identified themselves as smart home energy specialists and found few vendors capable of such solar optimisation.
Of the vendors I visited, nine couldn’t automate home solar. Instead, they offered data management displaying home electricity use, offering tips on energy saving, and allowing remote operation of appliances and lights via a smart phone. Most required that a smart meter be installed. The systems cost from around €20 to €150. Some came free with other purchases, say, of a ground-source heat pump. Several vendors said that they were working on solar optimisation as their “next step.”
Just four of the 13 vendors stated that they could optimise solar use by using batteries, water heaters and other appliances to minimise or eliminate grid exports. Two of these quoted prices of €500-€1,000. Given the capital cost of installing a solar system in the first place, this seems like a prohibitive price for most people.
I WAS ALSO SURPRISED BY THE PAYBACK PERIOD ON SOLAR SYSTEMS, as estimated, for example, by the Spanish solar installation data specialist Ezzing Solar, which markets via suppliers such as Viesgo Solar in Spain and Wekiwi Solar in Italy. The long payback periods illustrate why it is so important to optimise home systems.
Ezzing Solar seems to have really smart software, which allows one to estimate the electricity generation and cost of a home solar system in Spain or Italy just by typing an address and selecting a roof. But the answers are a bit worrying, especially in Spain, presumably because of the cost of installation, including taxes—the problem certainly isn’t the quality of the natural resource, as Spain is Europe’s sunniest country!
A casual use of the Wekiwi Solar simulations suggested an approximately five- to six-year payback on the upfront cost of an installation on a south-facing roof in Italy–which appears attractive and could appeal to households.
Get that below three years, and the allure would increase.
The Viesgo Solar simulations, on the other hand, indicated a payback period of 18-20 years in Spain. This kind of financing has little appeal, and it suggests a policy opening for the new government. Spain’s recent decision to scrap its so-called solar tax is a step in the right direction on cutting the red tape associated with installing residential solar.
Policymakers have many other levers they can pull to help consumers get more out of their home solar and/or battery installations, including subsidising devices that link home solar and batteries with smart meters, heat pumps, and other household appliances.
Gerard Wynn ([email protected]) is an IEEFA energy finance consultant.