New technologies continue to create new business models that could not have been imagined decades ago.
Unbelievably, German home battery manufacturer Sonnen has just launched a product offering that means you, the consumer, can receive free electricity for 10 years.
Yep, you read that right – 10 – years.
All you have to do is buy the battery (for €3,999) and become part of the Sonnen energy community of household producers and storers (imaginatively named – wait for it – the “sonnenCommunity”), allowing your battery to soak up or spew out electricity as and when needed. It’s limited to 5000 sales, but is surely a sign of where the home battery market could head in other countries.
Indeed, Sonnen is about to perform the same trick in Australia. It could earn more money from the Aussie national grid for balancing services than from households – households will again just pay for the battery and get free electricity.
Lessons from abroad
As we’re all now well aware, just as in Germany and Australia, energy storage is the next piece of the puzzle that will be slotted into the UK’s energy system. The sun shines, the wind blows, the tide comes in – add storage to the mix and burning fossil fuels will seem so last century.
In a digitally connected ‘smart’ world, grid balancing will be done by algorithms, and part of this process will involve instructing thousands of energy storage devices to either import or export electricity. As a by-product, we would be richer as well – the National Infrastructure Commission estimated consumers collectively could save up to £8 billion a year. Eight Billion!
Grid balancing has historically been all about matching supply to demand, but in the future will be as much about matching demand to supply, and that supply may not come directly from the normal operators. Not only will big centralised coal power stations be fossils, but if the sun isn’t shining/wind not blowing/uranium not splitting, then that electricity is likely to come from one of the millions of batteries that will become part and parcel of everyday life.
And there’s a good chance one of those batteries will be in your house.
The UK has some 3.23 GW of storage projects (as of August 2016, including pumped hydro), but the vast majority of this is found “in front of the meter” – in other words, it’s connected to the grid, not a private add-on in the home or business. Included in this figure are some 1500 household installations though, all of which have an associated solar array somewhere near them.
To give this some idea of this market’s potential, there are an estimated 34,000 household batteries in Germany already. Australia installed 6500 household systems last year. Indeed, Bloomberg New Energy Finance estimates that the global household battery market will become worth $250 billion by 2040.
One Step Off the Grid (Australia):
Little wonder, then, that Sonnen – which first rolled out its flat rate model in Germany in September last year and now has 6,000 battery systems in the German balancing market – is targeting Australia, with plans to offer the deal to customers here in the next two months.
Coupled with retail electricity prices that have pushed up consumer bills by more than 100 per cent over the past 10 years; a world-leading rooftop solar uptake; and the removal of premium solar feed-in tariffs, Australia’s is a market that’s ripe for disruption.
Wildpoldsried, 26 January 2017 – Until now, it was only possible for home owners to use a home energy storage unit that was connected to their own photovoltaic system or another off-grid energy source. However, members of the sonnenCommunity in Germany can now obtain, store and use free electricity from the community without needing to generate their own power.
The new sonnenBatterie city system can easily be installed in any apartment and enable opening up the sonnenCommunity to new customers. With the city system, customers receive 2,200 kWh of electricity free of charge every year for the next 10 years from sonnen – guaranteed. They also save approximately 300 kWh per year thanks to the sonnenBatterie’s built-in smart energy manager. The sonnenBatterie city is available for EUR 3,999 (gross price).
“The sonnenBatterie city will enable apartment renters and owners to save several hundred euros in electricity costs per year over the next ten years. What was previously only available to homeowners is now on the market for apartment dwellers as well. This puts clean, affordable energy within the grasp of so many more people,” states Philipp Schröder, Managing Director and Chief Sales & Marketing Officer of sonnen.
Instead of placing the burden on the homeowner to have an in-house photovoltaic system, the city system uses the sonnenCommunity, a dense network of electricity producers and consumers of renewable energy, as a source of generating and sharing electricity. The community members include detached houses fitted with PV systems, standalone PV installations, wind turbines, smaller biogas units, and now apartment owners.
If the sonnenCommunity generates more electricity than is required, apartment owners will be able to tap into this electricity pool to provide energy to power the household and simultaneously charge the sonnenBatterie. In the reverse scenario, if more electricity is consumed than is produced by the community, the household uses the energy stored in the sonnenBatterie city to provide power on demand.
The sonnenBatterie city fulfills a second function as well. It can balance out fluctuations in the public power grid, thereby helping to stabilize it. If there is too much energy in the power grid (perhaps due to a storm facilitating wind energy production), the sonnenBatterie can siphon off and store the surplus energy. If there is too little energy, the sonnenBatterie units can provide energy back to the power grid. This energy management service is provided thanks to a pool of thousands of sonnenBatterie units that are digitally linked to one another.
€3,999 is a very worthwhile investment. Hopefully this system will spread fast and wide.
At current electricity retail prices in Germany the €3,999 are more than paid off. Well done, Sonnen Batterie!
That was, in essence, my point in my comment above. You put it better than I did. 🙂
SonnenCommunity? That must be the place where the flower child flourishes! Or the sun bathers.
(Sorry, just being funny.)
That first video is a ridiculous bunch of techno-blather! At four minutes in, they say:
I note that that video is a couple of years old and that it is quantifying battery storage in units of power, along with the silly notion that 5 megawatts (or 5 megawatt hours) of battery capacity can replace 50 megawatts of power plant capacity.
So, you can’t imagine a scenario where that could be true?
A 5 mWh battery than can be cycled 10 times will provide 50 mW. If that can be done in the same timeframe that it takes the power plant to produce the 50 mW then it is possible. The math isn’t really that difficult.
That 5 mWh for the battery is a measure of energy. The 50 mW for the plant is a measure of power, that is a rate of delivering energy and it can deliver it any time for as long as you need it. Batteries also have a maximum rate that they can deliver energy. If it has a maximum rate of 50 mW (perhaps it’s a newfangled super capacitor), and it’s fully charged, it can deliver this rate of energy for 6 minutes. Then it’s going to need to be recharged. If the battery has a maximum rate of 5 mW, then no amount of recycling is going to replace the plant’s rate of 50 mW.
“Free” is a rather different quantity than four thousand euro. I guess they mean “too cheap to meter”? But no, that’s not true either.
If you run the numbers (including interest), the cost of electricity from Sonnen comes out to about €0.19/kWh, which is higher than in the US but a significant improvement on Germany’s average price of €0.30. So it makes sense for a German apartment dweller with an extra four thousand to spend.
But there is a hidden cost there too, not being talked about, and that’s the subsidy Sonnen gets from the German government to install home battery packs. So the first thing to realize is that, no surprise, things get cheaper when they’re subsidized. The second thing to realize is that subsidies aren’t free; they’re just moving the cost from your electric bill to your tax bill, where accountability can get lost in the shuffle.
Don’t get me wrong: I’m not against subsidies at all, and I think they’re important in the fight against global warming. But another thing that’s important is honesty without the hype. Free electricity? Sheesh. Can we get a headline that’s a bit less fake news?
And if you have significant electricity storage on the grid then you’ve effectively doubled (or more) the output from wind turbines as you can store what would be unused power production. How much would that worth to the owners of turbine farms? This would also mean that turbines have effectively dropped in cost by half or more for the unit power produced.