According to BloombergNEF, the 2020s are, without a doubt, “The Energy Storage Decade". But why is that, and what does it mean for the industry?
We caught up with our Commercial Director, Ed Gunn, to ask him about the residential storage market trends we’ll see in 2023 and their effects on the energy transition. Here are four top trends.
Demand for home batteries is on the rise, driven by consumers
Battery prices have been steadily dropping. Despite a slight increase in costs due to supply chain and pandemic headwinds, we expect this to ease through 2023. Meanwhile, energy prices have risen worldwide. When combined, it’s no surprise that home battery uptake is increasing everywhere.
A recent report from EnergySage says that now 17% of homeowners are purchasing home batteries alongside solar panels. This all-time high in the first half of 2022 was even before the August passage of the Inflation Reduction Act (IRA), that’s predicted to drive 62 gigawatts (GW) of additional solar capacity into the US solar market over the next five years.
Also, for the first time, stand-alone battery storage systems will also be eligible for tax credits thanks to IRA. Batteries don’t have to be installed with or charged by solar panels to receive the 30% tax credit. This will further spark demand for battery storage and lower prices for all consumers.
We’ll see a significant uptick in demand for home batteries in 2023. If the industry can keep pace with battery installs, we will have a rapidly growing fleet of devices we can aggregate to save money and cut carbon for consumers and the grid.
As virtual power plants scale, they’ll contribute to a greener, more stable grid
Intelligent home battery storage paired with solar is an integral part of the broader adoption of renewable energy, providing households with reliable and clean energy 24/7.
Smart home batteries not only store solar energy and intelligently dispatch it to provide maximum value to the household, but through Lunar Gridshare's virtual power plant (VPP) capability can be aggregated into a fleet of batteries to cut electricity demand during grid peak periods.
VPPs can help avoid the need for utility companies to build more natural gas peaker plants. Peaker plants turn on quickly to meet temporary peaks of demand but also are a large contributor to climate change since they emit hazardous pollutants.
As millions of homes generate and store their own clean energy, VPPs can be a source of peak power for the broader grid. This means we can retire peaker plants, some of the dirtiest, least efficient, and most expensive energy sources used today. The modern All-Electric Home, connected to other homes, will keep the grid balanced, greener and allow for more renewables to come online.
Fully integrated and easy-to-install home batteries will lead the market
With consumers increasingly asking for clean energy solutions, solar companies will now face new challenges to keep up with higher demand.
Home batteries need to be designed for fast and efficient installs. This includes having all-in-one systems with fewer parts. Gone are the days of many boxes on the wall. The hardware also needs to be installed quickly with the fewest number of installers possible. To further accelerate the speed of install, software is key for fast commissioning, troubleshooting, and testing. And finally, there needs to be flexibility in the design to add on more batteries over time as the home further electrifies.
Smart and intuitive software will put the customer in control further driving adoption
Software is essential for home batteries providing a range of benefits to customers and the grid. Home batteries controlled by Lunar Gridshare software are optimized to reduce customers' utility bills and carbon emissions. Using artificial intelligence and machine learning techniques, Gridshare generates detailed energy generation and consumption predictions, creating an optimal control plan to benefit the customer.
Gridshare also provides resilience by actively monitoring for weather alerts and charging up batteries to prepare for a potential blackout. With whole home backup, families can seamlessly keep their houses powered through an outage.
Smart batteries can also be connected to form virtual power plants. This way, they can import and export energy when needed most to decarbonize and stabilize the grid.
All this will lead to a decentralized energy system where individual households are in control and actively participate in the energy landscape.