Residential solar rooftop systems are proliferating in USA and Australia and 10% of all rooftops in Australia already boast of a rooftop solar system. But almost all systems are connected to the grid without energy storage. They have to rely on the electricity grid during the times when the sun is not shining. This has caused a lot of issues with utilities not wanting the solar energy, as it cuts down their revenues and increases costs. However, energy storage with solar panels is becoming the potential solution as homebuilders such as KB homes start launching them as standard products with new homes. Sunpower (SPWR) and SolarCity (SCTY) are already starting to provide energy storage solutions and this trend is set to accelerate with more companies such as Renesola (SOL), Trina (TSL) start offering them in different parts of the world.
SunPower plans to expand the energy storage option in other countries such as Germany soon, which is fast moving to the “prosumer” model. Germany offers additional incentives for solar rooftop owners who have energy storage. This is the next phase in the development of residential solar as companies look to take on utilities as the scale grows.
Energy storage industry has been plagued with cost and reliability issues. Many of the energy storage technologies such as flywheels have not taken off and there have been large bankruptcies such as A123 and Beacon Power. However, big green companies such as SolarCity have taken the initiative of providing long term cheap capital to this sector. SolarCity’s sister company Tesla plans to build a giant lithium storage factory to take on the energy storage shortage and cost issues head on.
SunPower believes that energy storage costs will come down dramatically in the next 5 years, as scale increases and technology improves. The company is already making a first mover play into the solar power cum energy storage market.