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Journal Article•DOI•

Economics of Residential Photovoltaic Battery Systems in Germany: The Case of Tesla’s Powerwall

Cong Nam Truong1, Maik Naumann1, Ralph Ch. Karl1, Marcus Müller1, Andreas Jossen1, Holger C. Hesse1 •
Technische Universität München1
11 May 2016-Batteries (Multidisciplinary Digital Publishing Institute)-Vol. 2, Iss: 2, pp 14
TL;DR: In this paper, the economic benefit of the Powerwall for end-users with respect to various influencing parameters: electricity price, aging characteristics of the batteries, topology of battery system coupling, subsidy schemes, and retrofitting of existing PV systems is analyzed.
Abstract: Residential photovoltaic (PV) battery systems increase households’ electricity self-consumption using rooftop PV systems and thus reduce the electricity bill. High investment costs of battery systems, however, prevent positive financial returns for most present residential battery installations in Germany. Tesla Motors, Inc. (Palo Alto, CA, USA) announced a novel battery system—the Powerwall—for only about 25% of the current German average market price. According to Tesla’s CEO Elon Musk, Germany is one of the key markets for their product. He has, however, not given numbers to support his statement. In this paper, we analyze the economic benefit of the Powerwall for end-users with respect to various influencing parameters: electricity price, aging characteristics of the batteries, topology of battery system coupling, subsidy schemes, and retrofitting of existing PV systems. Simulations show that three key-factors strongly influence economics: the price gap between electricity price and remuneration rate, the battery system’s investment cost, and the usable battery capacity. We reveal under which conditions a positive return on invest can be achieved and outline that the Powerwall could be a worthwhile investment in multiple, but not all, scenarios investigated. Resulting trends are generally transferrable to other home storage products.
Citations
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Journal Article•DOI•
Lithium-Ion Battery Storage for the Grid—A Review of Stationary Battery Storage System Design Tailored for Applications in Modern Power Grids

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Holger C. Hesse, Michael Schimpe, Daniel Kucevic, Andreas Jossen
11 Dec 2017-Energies
TL;DR: In this article, the authors present a review of battery energy storage systems for serving grid support in various application tasks based on real-world projects and their characteristics with respect to performance and aging.
Abstract: Battery energy storage systems have gained increasing interest for serving grid support in various application tasks. In particular, systems based on lithium-ion batteries have evolved rapidly with a wide range of cell technologies and system architectures available on the market. On the application side, different tasks for storage deployment demand distinct properties of the storage system. This review aims to serve as a guideline for best choice of battery technology, system design and operation for lithium-ion based storage systems to match a specific system application. Starting with an overview to lithium-ion battery technologies and their characteristics with respect to performance and aging, the storage system design is analyzed in detail based on an evaluation of real-world projects. Typical storage system applications are grouped and classified with respect to the challenges posed to the battery system. Publicly available modeling tools for technical and economic analysis are presented. A brief analysis of optimization approaches aims to point out challenges and potential solution techniques for system sizing, positioning and dispatch operation. For all areas reviewed herein, expected improvements and possible future developments are highlighted. In order to extract the full potential of stationary battery storage systems and to enable increased profitability of systems, future research should aim to a holistic system level approach combining not only performance tuning on a battery cell level and careful analysis of the application requirements, but also consider a proper selection of storage sub-components as well as an optimized system operation strategy.

458 citations

Cites background or methods from "Economics of Residential Photovolta..."

  • ...Simulations data was taken from previous investigations of battery storage operation (PCR [132], PS [174] and PV-BESS [13]) and is based on common naive controller operation strategies with no forecast or integrated dispatch optimization....

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  • ...Battery energy storage system (BESS) control analysis—Distribution of State of Charge (SOC) and C-rate for three exemplary storage simulations for different use cases: (a,d) BESS in frequency regulation (primary control reserve) application, data from [132]; (b,e) BESS in peak shaving application, data from [174]; (c,f) BESS in PV residential battery storage system application, data from [13]....

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  • ..., cell aging [54], power electronics losses [89], or economic evaluations [13,14]....

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  • ...As enforced by regulatory constraints or incentivized in some regions, this aspect may draw more attention in the future [13]....

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  • ...Equation (1) provides a possible approach to a simplified cost-benefit analysis: It summarizes the major contributions necessary for a Return on Investment (ROI) analysis as has been proposed for the economic analysis of residential storage systems [13,14]....

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Journal Article•DOI•
Quantifying self-consumption linked to solar home battery systems: Statistical analysis and economic assessment

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Sylvain Quoilin1, Konstantinos Kavvadias, Arnaud Mercier, Irene Pappone, Andreas Zucker •
University of Liège1
15 Nov 2016-Applied Energy
TL;DR: In this article, the authors simulate self-consumption in various EU countries, for various household profiles, with or without battery, and find that the selfconsumption is a non-linear, almost asymptotic function of PV and battery sizes.

182 citations

Cites background or result from "Economics of Residential Photovolta..."

  • ...[8] obtains similar results for a German houshold, in which a 7 kWh battery increases SSR from 38% to 65%....

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  • ...[8] analyses the profitability of a particular home battery brand in the case of Germany....

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Journal Article•DOI•
Techno-economic analysis of the viability of residential photovoltaic systems using lithium-ion batteries for energy storage in the United Kingdom

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Kotub Uddin1, Rebecca Gough2, Jonathan Radcliffe3, James Marco1, Paul Jennings1 •
University of Warwick1, Loughborough University2, University of Birmingham3
15 Nov 2017-Applied Energy
TL;DR: In this paper, a commercially available coupled photovoltaic lithium-ion battery system is installed within a mid-sized UK family home for more than one year and the battery degradation model is used to estimate the cost of battery degradation associated with cycling the battery according to the power profile logged from the residential property.

149 citations

Cites background from "Economics of Residential Photovolta..."

  • ...In many markets, small-scale generation from solar PV has increased rapidly, driven by cost reductions and subsidies [14,16]....

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  • ...[16] conclude that the viability of SHS is dependent on both an increasing retail price of electricity and financial subsidies....

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Journal Article•DOI•
Economic assessment of photovoltaic battery systems based on household load profiles

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Sandro Schopfer1, Verena Tiefenbeck1, Thorsten Staake2•
ETH Zurich1, University of Bamberg2
01 Aug 2018-Applied Energy
TL;DR: In this paper, the authors developed a machine learning algorithm that can predict system profitability based only on a limited set of features and on shorter measurement timeframes of smart-meter data.

128 citations

Journal Article•DOI•
Economic Optimization of Component Sizing for Residential Battery Storage Systems

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Holger C. Hesse, Rodrigo Martins, Petr Musilek, Maik Naumann, Cong Nam Truong, Andreas Jossen 
22 Jun 2017-Energies
TL;DR: In this paper, a general method for comprehensive PV-BESS techno-economic analysis and optimization is presented and applied to the state-of-the-art BESS to determine its optimal parameters.
Abstract: Battery energy storage systems (BESS) coupled with rooftop-mounted residential photovoltaic (PV) generation, designated as PV-BESS, draw increasing attention and market penetration as more and more such systems become available. The manifold BESS deployed to date rely on a variety of different battery technologies, show a great variation of battery size, and power electronics dimensioning. However, given today’s high investment costs of BESS, a well-matched design and adequate sizing of the storage systems are prerequisites to allow profitability for the end-user. The economic viability of a PV-BESS depends also on the battery operation, storage technology, and aging of the system. In this paper, a general method for comprehensive PV-BESS techno-economic analysis and optimization is presented and applied to the state-of-art PV-BESS to determine its optimal parameters. Using a linear optimization method, a cost-optimal sizing of the battery and power electronics is derived based on solar energy availability and local demand. At the same time, the power flow optimization reveals the best storage operation patterns considering a trade-off between energy purchase, feed-in remuneration, and battery aging. Using up to date technology-specific aging information and the investment cost of battery and inverter systems, three mature battery chemistries are compared; a lead-acid (PbA) system and two lithium-ion systems, one with lithium-iron-phosphate (LFP) and another with lithium-nickel-manganese-cobalt (NMC) cathode. The results show that different storage technology and component sizing provide the best economic performances, depending on the scenario of load demand and PV generation.

122 citations

Cites background or methods or result from "Economics of Residential Photovolta..."

  • ...However, lower values are often stated for less demanding residential storage applications [6,37]....

    [...]

  • ...For this work, the optimization approach is confined to an alternate current (AC) coupling of battery storage, which offers the broadest flexibility in system design and is also suitable for the retrofitting of existent PV installations [6]....

    [...]

  • ...To validate the optimization results presented in this study, we conducted 1-s resolved time series analyses of power flows using an in house developed storage assessment tool SimSES [5,6]....

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  • ...A closer look at the literature on the economics of PV-BESS systems confirms that such negative ROI is well in line with other studies based on similar parameters [5,6]....

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  • ...Although such differing topologies have their individual strengths and weaknesses, an overall consistent trend for choice of best technology and storage system sizing is expected [6]....

    [...]

References
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Journal Article•DOI•
Rapidly falling costs of battery packs for electric vehicles

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Björn Nykvist1, Måns Nilsson1, Måns Nilsson2•
Stockholm Environment Institute1, Royal Institute of Technology2
01 Apr 2015-Nature Climate Change
TL;DR: In this article, a systematic analysis reveals a steep decline in the costs of battery packs for electric vehicles, with market-leading manufacturers setting the pace with market leader Tesla and its suppliers.
Abstract: A systematic analysis reveals a steep decline in the costs of battery packs for electric vehicles, with market-leading manufacturers setting the pace.

1,578 citations

"Economics of Residential Photovolta..." refers background in this paper

  • ...Further subsidization and the predicted further price-decline of batteries [41] indicate increasing benefits....

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  • ...A price drop for batteries is expected [41], rendering the case more beneficial in the future, however we also assume the PV-system built in 2000 to be fully operational until 2040 in our calculations....

    [...]

Journal Article•DOI•
Lithium-ion battery cell degradation resulting from realistic vehicle and vehicle-to-grid utilization

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Scott B. Peterson1, Jay Apt1, Jay Whitacre1•
Carnegie Mellon University1
15 Apr 2010-Journal of Power Sources
TL;DR: In this article, the effects of combined driving and vehicle-to-grid (V2G) usage on the lifetime performance of relevant commercial Li-ion cells were studied, and a nominal realistic driving schedule was derived based on aggregating driving survey data and the Urban Dynamometer Driving Schedule, and used a vehicle physics model to create a daily battery duty cycle.

733 citations

Journal Article•DOI•
Optimal design and techno-economic analysis of a hybrid solar–wind power generation system

[...]

Hongxing Yang1, Zhou Wei1, Lou Chengzhi2•
Hong Kong Polytechnic University1, Tianjin University2
01 Feb 2009-Applied Energy
TL;DR: In this article, an optimal design model for designing hybrid solar-wind systems employing battery banks for calculating the system optimum configurations and ensuring that the annualized cost of the systems is minimized while satisfying the custom required loss of power supply probability (LPSP).

632 citations

Journal Article•DOI•
Calendar and cycle life study of Li(NiMnCo)O2-based 18650 lithium-ion batteries

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Madeleine Ecker1, Nerea Nieto1, Stefan Käbitz1, Johannes Schmalstieg1, Holger Blanke1, Alexander Warnecke1, Dirk Uwe Sauer1 •
RWTH Aachen University1
15 Feb 2014-Journal of Power Sources
TL;DR: In this paper, an extensive set of accelerated aging tests has been carried out employing a Li-ion high energy 18650 system (2.05-Ah), negative electrode: carbon, positive electrode: Li(NiMnCo)O2).

581 citations

Journal Article•DOI•
Sizing of Residential PV Battery Systems

[...]

J. Weniger1, T. Tjaden1, Volker Quaschning1•
HTW Berlin - University of Applied Sciences1
01 Jan 2014-Energy Procedia
TL;DR: In this article, an economic assessment of residential PV battery systems was carried out and the cost-optimal configurations for various cost scenarios were determined based on the simulation results, and the results show that in the considered long-term scenario the conjunction of PV systems with batteries will be not only profitable but also the most economical solution.

369 citations

"Economics of Residential Photovolta..." refers background or methods in this paper

  • ...Residential battery energy storage systems (BESS) to increase the self-consumption of rooftop photovoltaic (PV) installations remain economically unfavorable for the German market under almost all conditions; considering battery prices of 2015, the savings of such systems under German market conditions commonly cannot surpass the battery investment cost within the estimated system lifetime as of now [1,2]....

    [...]

  • ...[2] also found smaller BESS to be optimal....

    [...]

  • ...It is also feasible to couple the BESS directly to the PV-system on the direct current (DC) side of the PV-inverter that converts DC into alternating current (AC) for the household’s usage (Figure 1b) [2]....

    [...]

  • ...Retrofitting existing PV-systems with a BESS in this way, however, would require a rewiring of the system [2]....

    [...]

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Sizing of Residential PV Battery Systems

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Photovoltaic self-consumption in buildings : A review

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