Published on August 13th, 2014 | by Jake Richardson


Tesla Might Cause Grid Defection ‘Tipping Point’ To Occur

August 13th, 2014 by  

Solar Love.

Startups often focus on disrupting markets by having some penetrating insights, new technology or simply a desire to improve upon an existing product or service. Morgan Stanley’s report on Solar Power and Energy Storage contains a fascinating comment about the potential ramifications of Tesla’s focus on developing large numbers of electric batteries.

solar power

Image Credit: Sbharris, Wiki Commons

“Energy storage, when combined with solar power, could disrupt utilities in the US and Europe to the extent customers move to an off-grid approach. We believe Tesla’s energy storage product will be economically viable in parts of the US and Europe, and at a fraction of the cost of current storage alternatives,” it explains on page 1.

They go on to say why Tesla might have such an impact, “This advantage is driven primarily by the company’s very significant scale (Tesla will produce as many cells from its Gigafactory as are currently produced by all worldwide battery manufacturers combined) and integrated manufacturing efficiencies. We project the capital cost of Tesla’s battery will fall from the current $250/kWh to $150/kWh by 2020, whereas its closest competitor will be at a cost of ~$500/kWh,” it says on page 2.

The US Energy and Information Administration estimated that about 6% of the electricity transmitted and distributed each year is lost because of problems with national grid system. Six percent doesn’t sound like much, does it?

However, another estimate translated that number into dollars and came up with an amount for a single year, “Multiplying that number by the national average retail price of electricity for 2005, we can estimate those losses came at a cost to the US economy of just under $19.5 billion.” For ten years, the total lost would be $195 billion dollars, just due to grid  inefficiencies.

In a sense, the grid is also all the power plants connected to it, because they are the sources of the electricity. Coal plants are even less efficient, with only about 35% of the energy in coal becoming electricity after being burned and converted. An eventual grid defection doesn’t look so scary, when you consider that over the long term, we might be saving a lot of money and polluting our air, water and soil much less. Then, of course, there would be less climate change emissions contributing to that global problem.

Grid defection doesn’t have to 100% either; many early adopters could have home energy systems using renewables and remain grid connected in order to have a backup power system.

It’s hard to say when a tipping point might occur, but there have been a number of Americans that have lived off-grid or mostly so for a long time. Over 120 years ago, Charles Brush created his own wind turbine and home battery system.

Originally published on Solar Love. Reproduced with permission.

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  • Hans the Elder

    From a strict environmental point of view cutting the cord makes no sense. To supply yourself with electricity all year round you will need a completely over-dimensioned PV array and a large storage system, even then you will regularly throw away electricity that could have been used by the neighbours.

    However, defecting costumers might force utilities to stop seeing self-generators as the enemy, but instead as costumers that could deliver a valuable contribution to the electricity system. So from a strategic point of view cutting the cord, might be just the thing we need.

    Moreover, I advice that utilities are split in independent companies for electricity generation, transmission, distribution and retail.

    • Bob_Wallace

      As someone who is off the grid, and has been for many years, I totally agree. I waste solar kWh that someone else could use and I start up a gasoline generator when there is wind energy available on the grid.

      As for Americans exiting the grid, I don’t see that happening to any great extent.

      • jeffhre

        How are Tesla’s and EV’s generally selling in Hawaii? Heco’s resistance to solar may make Jake’s predictions for EV drivers there into a groundswell of self determination just a bit earlier than for the grid at large. Arizonans are at least being offered the rather strange option of allowing the IOU company to rent their roofs for $30 a month, to install solar panels.

        Truth is stranger than fiction it seems!

    • GCO

      Agreed 100%, going off-grid is bound to be very wasteful (and therefore not cheap either).

      Re utilities perception of customers-generators: it varies widely.

      The key factor is probably decoupling, or whether utilities revenue is dependent on energy sales. See

      Decoupling was implemented in 25 states in 2012. Sadly, mostly outside areas ideal for solar like Texas or Florida; unsurprisingly, utilities there push against PV — just like any other energy-saving measure I’m sure.
      Arizona Public Service Company recently adopted decoupling, we’ll see how that works out. ( page 19)

      The situation is completely opposite for example in California, where full decoupling is in effect:
      PV owners are considered an asset; they help a tiny bit with generation and the percentage of renewables utilities have to reach, at no or extremely low cost to them. Their policies encourage distributed generation: net metering (sometimes even in addition to TOU), incentives on PV installs etc.

  • spec9

    “We project the capital cost of Tesla’s battery will fall from the current $250/kWh to $150/kWh by 2020, whereas its closest competitor will be at a cost of ~$500/kWh,”

    How does that work? Tesla doesn’t make cells. Other companies could buy from Panasonic if they are so great.

    • Ronald Brakels

      Nissan will now replace a Leaf battery pack for $230 a kilowatt-hour. Either they are paying significantly less than $500 a kilowatt-hour or Nissan has decided to commit corporate seppuku.

      • Bob_Wallace

        I suspect they are ‘future pricing’. Not expecting very many replacements for few years. Take some losses early but anticipate battery prices will be down to that level before a significant number of replaces are needed.

        In the meantime they got some good advertising and reassured a lot of potential buyers.

        • juxx0r

          There was a report that they were losing money on those packs and i suggest you’re right that it’s a marketing exercise at the moment.

          • sault

            Keep in mind that energy capacity is often determined by a few weakly-performing cells and those can be replaced to bring the pack up to almost new capacity without having to replace the whole thing.

        • Ronald Brakels

          But clearly they expect to be able to produce battery packs for that cost in the future before they have to replace too many and so a 2020 price of around $500 a kilowatt-hour is not realistic and would require Nissan to be bonkers.

          • eveee

            The projections of battery, solar, and wind costs are often years off. Battery costs are definitely less than 300/kwhr. That is the cost of battery, enclosure, BMS, DC-DC, and inverter from Balqon. Tesla will have under 200. They are already under 300.

        • GCO

          “Future pricing” seems to be now. This company sells what looks like Leaf battery modules for ~250$/kW*h.

          (Impressive… This is even cheaper than the industrial LiFePO4 packs I’ve pointed to earlier: )

          I’d bet that the only money Nissan would lose on a pack replacement today would be for shipping etc.

    • WeaponZero

      Panasonic just manufactures the cells, but the cells are custom made using both Panasonic’s and Tesla’s technology. (Tesla actually has cell technology and an R&D lab in Michigan that researches battery cells). They also have their own pack technology which they custom build in-house.

      So no, Panasonic can’t just sell them batteries. But Nissan can license Tesla’s drivetrains with the batteries.

  • jstack6

    If we all work with the GRID everyone wins. We put clean power into the GRID during Peak hours and then use a little Off Peak since the GRID has excess and can’t ramp down and then back up to meet the next days demand.
    With Electric Vehicles we can do V2G and use the vehicles to store and then send a small amount to the GRID during Peak Demands. We can charge Off Peak and not add any load to the GRID during the Peaks. The Vehicle can also serve as power back up in case of a GRID failure.

    • eveee

      I think most reasonable people agree with that idea. Now try to get the utilities to cooperate with that in a meaningful way. 65.33 in grid connection fees? Rising rates with tiers that go up to 0.35? Its happening and it could increase as fuels become expensive and demand keeps dropping. The utility spiral does not mean lower rates. So how does that grid we want happen? Only if the utilities want to cooperate. So far, they want to hang on to monopoly. I would prefer a public grid. The grid won’t go away. But it might change ownership.

      • GCO

        The grid is already (or still) “public” in some areas, as in owned and operated by a community or city.
        A you would expect, as they’re public-service not for-profit entities, cooperative and municipal utilities rates are much more end-user-oriented than investor-owned (IOUs), with almost systematically lower rates and friendlier policies towards e.g. PV.
        Save for some spectacular screw-up, public utilities are IMHO completely safe from seeing customers leave them.

        • eveee

          Yes, Monopoly is not good for consumers. Thats why utilities competing in the distributed solar market is wrong and should be illegal. APS should not be allowed to do that. Their intentions and motivations are all wrong. The want to continue to be a monopoly. Consumers don’t need that.

  • Joseph Hall

    I have a 4.14kW system – it’s awesome. Can’t wait to have battery storage to go along with it. How nice.

    The grid as we know it is finished. Rooftop solar is going to be king. It’s so easy, it’s so reasonable, it’s there for the taking. I drive around and look at rooftops and think to myself they’re black gold just waiting for solar panels.

    So regional utilities married to the fossil fuels industry is over. Their collapse is written in stone. I wonder is SolarCity/Telsa will make a play for a regional power company? I’m sure they’re sick of dealing with them. Maybe take one over and transform it from the inside out?

    • GCO

      Weird. I have PV too, which covers all my needs on average, and the last thing I want would be to disconnect from the grid:

      1) It would make my system much less useful.
      I generate 2~3 MW*h excess in spring/summer, no way I could store this in batteries (even assuming 100$/kW*h and a 20-year life, that’s be 5$/kW*h… 5 bucks!). Right now, all of this immediately goes to my neighbors AC and what-not, nothing is wasted.

      2) In December and January, my PV system barely produces half of what I use, so without the grid, it’d need to be twice as large. Not only my roof couldn’t accommodate this, but this would now make 1) dramatically worse.

      3) Charging/discharging batteries (along with the related voltage conversions) isn’t 100% efficient, exacerbating both waste and capacity problems.

      So no, while rooftop PV will challenge some generation (especially hard-to-modulate coal and nuclear plants), I don’t see mass grid defection happening anytime soon, at least not in most areas. It’d take a combination of favorable climate and very high utility fees to justify such a measure.

      • Vensonata

        True: off grid is a scary plunge, but I think a whole re formulation of how it is done needs to be undertaken. Eg. What to do with vast summer overproduction…use it for domestic hot water, ev charging. What to do in skinny winter production…use gas/propane domestic hot water. The economics are not bad overall. Seasonal storage of electricity is impossible with batteries. Heat storage is possible but limited. Hydrogen from overproduction electric is also possible but 70% efficiency loss…still free juice though. So the basic question, to make it viable is: how to seasonally balance pv production? Smart people wanted! Tell us your plan.

        • Mint

          How can you use summer overproduction to charge your EV? Your winter production has to power the EV as well. Unless you excessively use hot water, you don’t save much by heating it with excess electricity.

          Long term H2 storage and fuel cells, however, does make some sense, and efficiency could hit 50% round trip. I think if Toyota or Hyundai really had fuel cells that were even 3x too expensive for cars (which need them to be ~$0.05-0.10/W to compete with gas engines), they’d make billions selling them to the power generation market.

          • jeffhre

            Boy, city dwellers are sure lucky. “Store” excess production on the grid, and round trip efficiency could be 90%.

          • Mint

            The grid is obviously the most efficient solution. But the context of the discussion is going off-grid.

          • GCO

            Morgan Stanley (whose report is the focus of the above article) forecasts that people will leave the grid.
            Showing that it’s generally not a good or desirable outcome disproves their claims.

          • GCO

            Net metering makes the grid “battery” 100% efficient: I can take back exactly the same number of kW⋅h that I put in, before paying anything.

            As any PV excess will just help power nearby loads, extremely little is lost. Better yet, as it replaces generation from much further away, which would incur transmission losses (up to several %), we could argue that the grid efficiency as “storage” is even higher than 100%: for each kW⋅h a PV system feeds in, the utility needs to generate maybe 1.02 kW⋅h less.

          • Vensonata

            But how long can this go on? Grid as storage only works when everybody is not doing fact if 50% did it their would be overproduction in the summer on a regular basis. It won’t happen for a while but this is honeymoon phase.

          • GCO

            I highly doubt we’ll ever reach 50%, but in any case, net metering will be history long before that.
            We’ll almost also surely see meters register per-minute pricing (kind of ‘dynamic TOU’), making ‘storage’ only interesting when there is demand.

            If energy becomes plentiful during the day, pricing will reflect that, and people will act accordingly. Today already, wherever TOU pricing is in place, and there only, almost all PEV owners program their vehicle to charge when it’s the cheapest =>
            There won’t be a surplus any more than there is today.

            Beyond residential PV, the California ‘grid management’ (CA-ISO) has been looking into how the grid is likely to evolve with lots of utility-scale solar.
            While I find some of their findinds pessimistic, self-serving even, it’s nonetheless interesting:
            Basically, “base-load” power plants are dead.

        • GCO

          What to do with vast summer overproduction…use it for domestic hot water, ev charging.

          I have solar hot water, already more than enough in summer, and the EV uses about the same amount of electricity all year long — if anything, slightly more in winter.

          What to do in skinny winter production…use gas/propane domestic hot water.

          My hot water backup heater is already gas-fired. No gain possible there either.

          Hydrogen from overproduction …still free juice though.

          Say this bidirectional H2 gizmo lasts 20 years and costs “only” 12k$, that’s still 50$/month, more than my past electricity bill.

          how to seasonally balance pv production?

          The best solution I’ve found so far: exchange electricity with others. Sell any excess production, and buy back whatever is needed.
          The best part is, almost everywhere, all the wiring required to do this is already installed. It’s so prevalent, some call this ‘the grid’.

          Tell us your plan

          Stay on-grid, it’s much cheaper and much greener than any alternative available to me.

          • jeffhre

            “The best solution I’ve found so far: exchange electricity with others. Sell any excess production, and buy back whatever is needed.
            The best part is, almost everywhere, all the wiring required to do this is already installed. It’s so prevalent, some call this ‘the grid’.” LOL, ROTFLM, well you get the picture!!

            “…some call this ‘the grid,” Ha!

          • mds

            Yep, just as long as the utilities keep it that way and don’t start to price you out with “fixed costs” or high rates.

          • vensonata

            You are well on the way, and yes, why would you go off grid….Now. But who knows the curve balls up the road. One environmental factor is: where does my grid energy come from…coal? If that is the case, like fair trade coffee, some will be willing to pay more or have less convenience out conscience. The case of the electric car in winter is a tricky one. If you use a hybrid, what is the difference between that and a home generator charging your batteries…in fact it could be cheaper and more efficient to (get this) NOT carry your car i.c.e. with you when you drive! Now that is a thought isn’t it? Leave your heavy motor at home in the yard!

  • KM

    Strange that they are cautious in their report about First Solar when it is the only company seeing significant improvements in efficiency of their products. By the time Tesla reaches the estimated $150/kWh for storage systems First Solar will probably beat most chinese modules in effciency and will be suitable for rooftop applications. Quote from Forbes: ‘First Solar’s panels currently offer average conversion efficiencies of
    around 13.4%. In comparison, polycrystalline panels, which are typically
    manufactured by Chinese companies, offer efficiencies of around 15% to
    16%, while high-end monocrystalline panels sometimes have efficiencies
    of over 20%. First Solar’s roadmap indicates that its module
    efficiencies could improve to around 14.9% this year while rising to
    around 19.5% by 2017, as compared to its previous roadmap which targeted
    a 17.2% efficiency in the same time frame. The company expects the
    efficiency of its modules to equal those of polycrystalline modules by
    the end of 2015.’ So unless Silevo turns out to be another ace in Musk’s sleeve I would say First Solar should be just fine.

    • mds

      I think you should feel very vulnerable if you cannot produce 20% efficient panels at less than 50c/Wp within the next few years. 19.5% – 13.4% = 6.1% First Solar must achieve nearly a 50% improvement in efficiency by 2017 while knocking their price per Wp down further. I’m not saying they can’t do it. I’m saying they cannot afford any mis-step. They better not est on their laurels. Silicon PV will be there. Will CdTe/First Solar? Will CIGS/Solar Frontier? Who knows? Very interesting race.

      • juxx0r

        CdTe has a MUCH better temperature coefficient, so in real world in some conditions, they’re a better panel even with the lower efficiency.

        • mds

          I know and First Solar is doing ok right now because of this. You miss my point. They better meet their production goals for 2017 or they will not be doing ok. That is a hell of an improvement rate they’ve singed up to …from a historical industry point of view.
          You said: “I would say First Solar should be just fine”
          I would say: “Don’t get over-confident. Be aware of the challenge they face.”

  • GCO

    I disagree with many of the points made in that paper, but this probably best illustrates the level of understanding of the authors:

    by 2020, [Tesla’s] closest competitor will be at a cost of ~$500/kWh

    Industrial packs, with BMS, are available today for much less than that already, retail price =>

  • Vensonata

    I told you so! Off grid house, off (gas) grid car, it all makes a nice package. Of course this is how it will go: as people use less grid electricity and more pv and battery storage, the electric companies will have to raise their price for the trivial amount of juice the customer buys, and the evil thought will occur ” let’s charge a minimum monthly fee for simply being hooked up”. Thank you sirs, that will be the grid evacuation signal which will put you gentlemen out of your noble business.

    • Steve Grinwis

      I already have a fee like that for both hydro and natural gas connection.

    • Matt

      You don’t already have a a grid connect fee in your monthly bill? In Cin Ohio with Duke as the king. I have 3 fixed fees:
      A)Dist-customer Chg $6.00
      B)Delivery rider $37.88
      C)Generation Riders $19.67
      Total connect fee $63.55/month

      Note that Duke does not generate my power I pay DominionEnergy for that $0.0678/kWh
      And distribution to Duke $0.025342/kWh

      While (A) street to my house and meter maybe? and (B) keeping wires up; I get. Not sure why I have to pay for Duke generators (C) guess that supports the Nuc’s they have or are building that I don’t use.

      • GCO

        Total connect fee $63.55/month

        Ouch! Ok, now I can understand why some people might consider cutting the cord. At that price, in a few years, the cost of batteries and extra PV might just start to make sense in favorable climates.

        The municipal (city-owned, not investor-owned) utility providing my service charges exactly 0$. It even subsidized my PV system.
        I eventually expect a 5~10$/month charge just like for water and NG, which will remain far cheaper than the 2~3x larger PV system I would need to be self-reliant in winter, even if batteries were free.

        • jeffhre

          I predict you will get that 5 to 10 dollar fee, the moment you move the an IOU supplied territory! One way or another.

      • Vensonata

        No fee for me, off grid solar communtiy for 14 years. By the way, just the $63 dollars per month fee would pay our electric outlay for person, 10,000 sq ft house…all by solar with battery storage. Of course we have spent years tightening it down to about 10 kwh day, but if you were purchasing electricity a 10 cents kwh that would be 630 kwh per month just for your mystery fees. You do the math…what kind of pv could you have for that. Or perhaps your house is not suitable…many are not. But consider. Heat pumps, l.e.d. Lighting. Ultra efficient “refreezerator” etc. etc. part of the frustration though is to reduce your electric use to 350 kwh month and end up paying30cents kwh because of extra fees. I don’t have the solution but some smart fellows out there do.

        • GCO

          Nice! If you don’t mind me asking, how much PV and storage do you have? I imagine you currently use lead-acid?

          I estimate that my grid-tied 6kW PV cost me the equivalent of 40~50$/month (assuming a somewhat-pessimistic 30-year depreciation with zero residual; it’d be cheaper if installed today).
          You probably get away with a bit less (I assume you live somewhere sunny), but now have to account for batteries every, what, 5~6 years?

          Just curious to hear how the economics of off-grid play out from someone who has direct knowledge of that stuff.

          If it takes 50$+ monthly fees before customers start running away, I think most utilities are pretty safe.

          • Vensonata

            Currently 3.4 kwh pv, 75 kwh agm battery storage 6 years old. This month we are adding 8 more kwh pv to bring total to 11.4kwh array. The batteries are showing their age (me too), however the formula has now changed. The 12 kw diesel generator should no longer run at all in winter, yippee. The next battery bank needs to be only half the size! That is a drastic cost reduction in diesel, maintenance, battery costs and lifespan ( the battery at 32 kw will rarely discharge below the overnight 5 kwh usage in winter…that about 15% discharge cycle.)

          • Vensonata

            Continuing above: in order to be 100% solar in a very poor winter light area you need to vastly overproduce in the rest of the year (December gives 25% of June). So what to do with all that power? Domestic hot water 9 months a year. And space heat in 3000 gal super insulated storage which can store seasonally( already installed. And finally ev charging 9 months per year. That is how to use the full production year round. So I hope this new re think helps other off grid dwellers…glad to hear any good ideas from y’all.

          • GCO

            Indeed, I’m in NorCal and my PV already produces 3x less in December than in June (weather also plays a role though).

            Do you just not drive your EV in winter? Not really an option for me though, I don’t have another car and still need to get to work etc.
            I suspect that, instead, a PHV (plug-in hybrid) could work in this situation, but not plugging it in part of the year somewhat defeats the point of getting a plug-in in the first place I’d think…

            More in my previous answer =>

          • GCO

            Thanks for the reply, very interesting. [Please, use kW (not kW·h) when talking about power though, wrong units make my engineer eyes hurt.]

            75 kW·h of batteries, wow, that’s massive! Quick back-of-envelope calculation: even assuming a cheap 100$/kW·h all included, and a generous 8 years lifespan, that’s ~80$/month!
            Plus PV, plus diesel…

            Glad to hear you’re expending your PV array to cut down on diesel and future batteries, but I still can’t figure out how this can possibly be financially interesting.

            Are you in an remote area where a grid connection isn’t pratical, or did you maybe go off-grid for reasons other than economical, e.g. political or as a personal challenge? Just curious as to what would drive a household to go this route…

          • vensonata

            Grid connection is 4miles away. $160,000 to hook up ten years ago, now maybe $200,000. This is Canada. So any elaborate off grid costs are far less. Remember to hook up for 200,000 means you have the privilege of buying electricity from them! So Yes, the original stuff was expensive but, now it is falling at such a rate its hard to keep up. The economics makes you continually have to re think the whole picture. Ideas that were valid two years ago are no longer coherent. Even people in each area of the building trades, architecture, engineering, are struggling to stay current. Clean technica is a helpful resource, Green Building Advisor is another jewel.

          • Bob_Wallace

            Wow! It’s cheap to hook up where you are.

            Down here in California I as quoted $300,000 for a 3.5 mile run 14 years ago.

            My 1.2 kW initial system, including a diesel generator, cost me $10k. (I got a good deal on pre-owned, but never used, panels. But expensive by today’s prices. $3.85/watt IIRC.)

          • GCO

            Ok, that makes a lot of sense, I’d certainly have made the same decision in your or @Bob_Wallace:disqus’s situation. 160k+$ buys a lot of diesel or PV, even back then… Thanks for the insights.

    • Bob_Wallace

      The grid won’t go out of business. Far too many people simply don’t have roofs that they own. Far too many people won’t get it together to install and run a system.

      We’re going to see great disruptions in the energy business. In the US it may not be too bad because many of our thermal plants are already about aged out. Utilities will replace them with cheaper renewable generation.
      Utilities will also be able to purchase storage technology cheaper than will end-users and will have access to things like wind, hydro and gas peakers that are out of reach for end-users.

      Many of us who run our own utility companies fail to cost in our time and labor. Including the learning and “keeping up” time. Most people won’t do it themselves but buy packages that someone else installs and maintains. That will close up the cost spread a bit.

      • Vensonata

        You are right Bob, “the grid won’t go out of business” but some utilities might. It is like imagining in 2007 that I made the outrageous prediction that GM would go out of business! Well bankruptcy is close enough.
        Some sort of grids will be necessary, but they may be disruptive…solar city anyone? Bloated utilities are ripe for a fall, and new leaner innovators will take their place.

        • eveee

          Vensonata-You have a point there. Perhaps the utilities don’t go out of business, but go bankrupt and/or restructure. Even some of them may be forced to sell assets to cover costs. That even may be likely, especially if demand drops quickly.

          • Hans

            I am always surprised that Americans do not seem to question their utility business model. Electricity transmission and distribution are natural monopolies that should be in (semi-) government hands, or strictly regulated. Power production and retail are not and could be left to the free market. In such an ideal world grid operators would have no incentive to favour specific generators.

          • eveee

            Hans – Yes. Yes. Yes. I wish you posted that in huge letters on everyone’s screen. Its the notion of “common good”. We have a superhighway everyone uses and everyone pays for and everyone owns. Why on earth do we have a private monopolized grid? Its stupid. And the whole concept of guaranteed rate of return for monopolies is nuts. The US is laboring under the illusion that PUCs regulate monopolies and protect consumers. Bunk.

          • Mint

            Utilities will not go bankrupt, because they’re almost all regulated monopolies. I don’t know of any areas with multiple grids connected to most houses/businesses. If kWh sold goes down, rates will go up to cover any loss. It’s that simple.

            I think some aging generators will be shut down as opposed to refurbished, and batteries from Tesla and others will take their place. But only some.

            The big disruption will be in pricing. The predictions by several people here about fixed charges is almost guaranteed, but beyond that who knows what price tiers, residential/commercial rate spread, TOU, and other factors will look like.

          • mds

            “If kWh sold goes down, rates will go up to cover any loss. It’s that simple.”
            I don’t agree. Some already live off-grid. Clearly this number is going to increase. If rates go up a lot, then it will increase a lot. That is also simple.
            Lower-cost battery storage is coming. Listen to the technical expert from Tesla talk about their battery storage being used for home and business by SolarCity.
            If you have battery storage and solar (this will be common), then how much does a rainy-day generator cost to own/operate? Answer: Not much. If utilities raise their rates enough…
            People get very protective of their wallets/purses.
            “rates will go up to cover any loss”
            Think again about this. There is a limit and now there is a choice. …particularly in sunny areas like Australia, Hawaii, California…
            You cannot charge me a fixed price if I’m not connected.
            The grid we know now, will be different in 10, 20, 30 years. Very different.

          • Mint

            I listened to everything, and went through all the numbers. Only a tiny percentage of people are truly off grid as opposed to net-metered, and the only time it’s remotely economic is if their property requires a huge investment to get connected.

            Gas generators are cheap, but fuel is expensive: $0.50/kWh at best. You don’t want to use it regularly for an entire winter, and that can double the cost of just the solar array to avoid that. Look at the comments of people who, in the winter, get 1/3rd of summer generation, even in California.

            Tesla’s biggest market is not going to be end users, IMO. It’s going to be businesses (that need to avoid peaky loads) and power plants. A battery system can make a 100MW plant into a 200MW one (for 5 hours a day), and such a system will soon cost somewhat less than the base 100MW.

            Anyway, the point of my post was that utilities aren’t going bankrupt. They’re merely going to change pricing.

          • mds

            Look forward. Consider Australia and Hawaii.

            “Gas generators are cheap, but fuel is expensive: $0.50/kWh at best.”

            50c/kWh is the cost of diesel electricity generation, so you must mean gasoline. NG is cheaper in the US. Of course it will reach European prices once exporting gets going and this will happen because a few of the majors can make a lot of money doing this and they largely run our government. You can have that point.

            “Only a tiny percentage of people are truly off grid as opposed to net-metered, and the only time it’s remotely economic is if their property requires a huge investment to get connected.”

            This is like the argument that Solar PV will not be contributing significantly to our electricity supply in 20 years because it is still at such a small fraction. Clearly this one is false because global Solar PV production and installation are doubling every two years. The off-grid percentage is harder to predict, but could also change quickly. The cost of Solar PV installation is still dropping rapidly. Low-cost battery storage is just now coming to the market and this cost will also drop rapidly. Did you watch the video of the Tesla technical lead at this site? If not, then please do.

            Bottom line: The economics right now are changing. In five or ten years the cost of Solar PV and Storage will be significantly lower. More people will be generating their own electricity. Utilities will be selling less power. They will still have to pay for their long term centralized assets. You have to raise your rates or you face can’t pay bills. If you raise your rates, then more people will use less power. If you raise them too much then more people will go off-grid. I’m sure you’re already aware of this “death spiral”. I say look at Australia and Hawaii, because they are at this crunch point now.

            You are already admitting SolarCity will help businesses to avoid “peaky loads”. What they are doing is saving money. Money that they would be paying to the Utility. This will be revenue lost to the utility. The fact that you state this differently demonstrates your bias and why you are missing my point. What makes you think home owners will not do the same thing? Once they have done this, how much generator operation time will they need to go completely off-grid? In some areas, not much. Even diesel or gasoline power at 50c/kWh is cheap when you only need to run it a week or two a year. The fuel cost is most of the expense, and if you don’t use much fuel… Again, consider Hawaii and Australia. Do not under-estimate the greed and bloody mindedness involved by some. One of the utilities in Australia has just changed their meter reading rates from $40 a day to $400 dollars a day to try and kill solar. Talking about shooting yourself in the groin, as Ronald Brakels recently wrote. …in Australia …talk about a place it will be easy to chose off-grid.

            No, I think you are wrong. I do not think the Utilities can avoid financial trouble by simply jacking up their rates. It is not going to wash. The US is still catching up with German and Australian Solar PV installation costs. There is no question our installation costs are going to go down significantly. There is also no question Solar PV panel costs will continue to drop in the short term below 50c/Wp. There is no question Storage costs will drop significantly. End-of-grid electricity costs are lower for mainland US states than for Hawaii, Australia, or Germany, end-of-grid solar power does not have to pay the cost of distribution infrastructure, typically about half the cost of our power. It has that financial advantage and that is big. As the costs come down for Solar PV and Storage, then some Utilities will try to jack prices, …just as in Australia …in sunny areas in the US, the whole lower half of the US, it will be very easy to go completely off-grid …and it will make financial sense to do this. Look forward. The central utility paradigm has changed forever.

            “Anyway, the point of my post was that utilities aren’t going bankrupt. They’re merely going to change pricing.”
            I submit the opinion that you are wrong. Visualize a building you call the Centralized Utility Paradigm. Now visualize an explosion. It will look different. How much of that building will be left as is??? That is the question. How much will be different? How much will need to be rebuilt (restructured)? They are not going to be able to “merely” “change pricing”. Not true. I can’t tell you what it will look like when the dust of that explosion settles, but I can tell you is will be different.

          • Bob_Wallace

            Looking forward at Australia and Hawaii.

            Both have very expensive electricity and it probably makes financial sense for some people to get off those grids right now. But those high price may well not hold.

            Australia is likely to undergo some massive write offs of fossil fuel plants. But Australia has large wind resources and those are likely to come on line and cut electricity costs over time. The price of electricity will fall quicker in Hawaii as it is fuel-driven. As wind, solar and geothermal produce more diesel use will decline and grid prices will fall.

          • mds

            You are only half correct. There are already utilities in Australia who are naming a few towns that would be better (i.e. more economically) served by micro-grids. Obviously, there are remote (very remote) farm dwellings in Australia that will be better served by going off-grid. No doubt some already are. The relative economics of grid power verses off-grid power is changing significantly. Australia is the most obvious example. A significant part of why their electricity is more expensive is because you have a small population spread out over a large area. That makes their grid expensive to maintain on a per customer basis. That cannot be wished away by better grid policies. Their grid infrastructure is going to change and it will no longer connect in some places.

            This debate always involves a lot of individuals say the grid will still be there, the current paradigm. …and other individuals saying, or implying, everyone is going off-grid. Both view are incorrect. It will be a different mix and this mix will depend on Utility prices, How low the cost of Solar and Storage get, and the solar resource available in the area.

            I’m reminded of a cartoon a friend used to have on her wall. If was of two psychologists debating genetic causes of behavior verses environment causes. The one is saying 60% 40% and the other is saying 40% 60%. Same thing here, but those percentages will vary depending on Utility Power cost, Solar/Storage cost, and the Solar Resource available. It will not continue to be the 99.9% Utility verses 0.1% off-grid that it is now. (or whatever the real percentage is ..and that already varies regionally) [Then again in some high latitude regions with poor insolation it may be exactly that.]

            In Australia there is going to be a much large amount of off-grid solar and micro-grids. The economics are there. If the utilities raise charges then it will create the environment for a higher percentage off-grid and micro-grids. (…and once they are in place they are unlikely to change. That’s how technology rolls.) If the cost of grid power is higher then customers will elect to go off-grid for simple economic reasons. Obviously. …but apparently not to some.

            In Hawaii the same thing is playing out. The HECO solution is easy. Change the grid to be bi-directional and become a solar power redistributor …with diesel backup power. …so simple that it boggles my mind they won’t do it. They should be discussing financing for phased transition to this several years ago, certainly now. Again, and again, the cost of Solar is still dropping and the low-cost of Storage is just coming to the market. As these get cheaper, then how low does it have to go before customers just say: “Hey HECO good riddance.”? …before Hotels say: “Hey, we’re going micro-grid, purchasing solar power from this block of residences, and installing our own battery plus diesel generator (that will rarely be used).” Think the bureaucrats will block this when they might lose their positions in the next election? Once this has happened…
            Keeping the existing grid in place and fixing it to serve better, certainly makes more sense to me, but technology does not always roll out in the most sensible way. …and
            Never under estimate the stupidity of politicians and bureaucrats. …and the economics cost are important.
            Hawaii may well end up 100% micro-grids and off-grid. …or not at all. Who can say. History will tell.

            Look for this transitional disruption to hit Southern California next.

            So Bob, you tell me for California, 90% 10%? 10% 90%? 50% 50%? I don’t know, but you’re already off-grid so it always makes me chuckle to hear you defend a need for the grid. The economics are changing very significantly. Costs for Solar+Storage will be half or a quarter of what they are now in 5 to 10 years. All I know is the ratio of off-grid will increase. Wind is very nice and needs grid connection for distribution. It is contributing greatly to reducing out CO2 outputting and lowering our grid electricity costs but it ain’t needed at all in the vicinity of the Mohave Desert, the well populated Palm Desert area for example, not with low-cost storage for nighttime use.
            The LA area with ocean fog and smog may be different …or with increasing economics, it may not be different.


          • Bob_Wallace

            Micro-grids are not “off the grid”. Micro-grids are areas separating themselves from the current more expensive grid, ducking legacy costs and creating a new grid.

            Australia has expensive electricity because the utilities vastly overbuilt capacity and spent too much on distribution infrastructure. They did not anticipate falling demand due to increased efficiency and rooftop solar.

            Australia and Hawaii are outliers. What the world does will not be determined by the most extreme cases, but something closer to the average. And, as I pointed out, electricity prices in Hawaii could quickly drop to “mainland” prices as they push oil into a backup-only role.

            Hawaii, from what I read, paused in order to study the best route forward. Let’s give them a few more months to work out their transition off oil. Their grid was not designed for a high penetration of solar, they’ll have to figure out how deal with higher levels – which might mean adding a lot more storage.

            I’ve been offgrid for over 25 years. Today in sunny California I will be running my generator and there’s not a cloud in the sky. But it’s smokey. It’s fire season. I’m going to be making some “50 cent/kWh” electricity when I could be buying < 20 cent/kWh electricity were I connected.

            "but (wind) ain't needed at all in the vicinity of the Mohave Desert, the well populated Palm Desert area for example, not with low-cost storage for nighttime use."

            What percentage of the world's population lives in a place that gets 360 days of sunshine a year?

          • mds

            “Micro-grids are not “off the grid”.”
            I disagree. They are off-the-main-grid and do not benefit from grid central generation or dispatchable hydro. They are a break from the centralized mega-grid paradigm. In this sense they are off-grid. I consider micro-grid off-grid.

            “Australia has expensive electricity because the utilities vastly
            overbuilt capacity and spent too much on distribution infrastructure.
            They did not anticipate falling demand due to increased efficiency and
            rooftop solar.”
            I agree with both points, but the low population spread over a large area is also a factor and causes some of that higher cost.

            “Australia and Hawaii are outliers.” Yes, and as such they are harbingers of what is coming to Southern California and the rest of the Southern US, as the cost of Solar+Storage continues to drop.

            “Hawaii, from what I read, paused in order to study the best route
            forward. Let’s give them a few more months to work out their transition
            off oil. Their grid was not designed for a high penetration of solar,
            they’ll have to figure out how deal with higher levels – which might
            mean adding a lot more storage.”
            I’m speak a little bureautese. They
            are stalling! This is not rocket science. They need no storage to
            allow a higher penetration than they have now, their problem is
            over-voltage. It could be solved in a snap by implementing a
            bi-directional capability. This is what they need to do to become solar power redistributors. You are really not thinking about this one. Niether are they …which is why a lessor but more expedient approach like individuals, or groups, going off-grid might happen.

            “Today in sunny California I will be running my generator and there’s not a cloud in the sky. But it’s smokey.”
            Buy some more Solar PV panels. They’re cheaper than they used to be. …or wait a few years and they’ll be cheaper still.

            “What percentage of the world’s population lives in a place that gets 360 days of sunshine a year?”
            OK fair point. You got me on that one and on your smokey sky situation, …but you’re still only half correct. More individuals are going to go off-grid because it is cheaper to do this …and it is getting more expensive to use utility power.

            Maybe you are 80% correct and off-grid will be 20%. You are not 100% correct about the grid staying. I don’t agree with that. Vensonata sees it. What about Arizona? What about when Solar+Storage is half or a quarter the cost it is now? That is coming.

            Interesting debate to me. I’m fascinated by what might or might not happen. Thanks and please have at it again if you like. So far, I’m not convinced the grid is as essential economically as you and a few others say.

          • Bob_Wallace

            Solar cost drops work on both sides of the meter.

            Some utilities are being knuckle heads and trying to keep the future from happening, but that strategy won’t work. They will either fold and eat their stranded asset losses or go bankrupt and some new entity will take over, leaving the stranded losses behind.

            We’re tossing around storage costs for off grid. Ten cents is the lowest I’ve seen anyone suggest. Utilities can purchase the same batteries in huge quantity and sell storage for less than 10 cents. Or they can forego storage and sell wind or hydro for less than 5 cents. Volume purchasing and access to the least expensive non-solar supplies are going to win out over home-stored solar.

            Now, 20% off and 80% on? Worldwide, maybe. All the folks now getting their first electricity in the form of micro-solar may never hook up. A large percentage of them might join up into micro grids. Spring for a commonly owned wind turbine, for example.

            In the US and Europe? I highly doubt it. 20% or a bit more may get rooftop solar. But at ~25% penetration we saturate in terms of direct use solar. The other 75% live someplace where installing panels would be very difficult/impossible or will just never get it together.

            The grid is simply too convenient. With increased efficiency people will use less electricity, the savings by moving off grid will decrease in absolute numbers.

            The grid is likely to offer inexpensive charging for EVs. If the utility can control the time of charge then they can sell the cheapest power to EV drivers. Charging an EV off the grid is likely to be well under 10/kWh. Hard to hit that price point with solar unless you park next to your panels during the day. Individuals can’t store their own power and compete with late night wind for nighttime charging.

            To get massive movement off the grid the price difference would need to be (almost) enormous. And I simply don’t see that happening. Utilities will be able to purchase power and storage for at least 10% less than individuals and there’s their 10% profit.

          • mds

            Well argued. Thank you. You don’t think Southern California will go through the same Resistive Utility nonsense as Hawaii and Australia?

            To pick up from your comment elsewhere here: 12c/kWh seems fair (or even a little low) for Solar PV right now, but cut that in half by 2020. 15c/kWh for storage, should be able to go lower also. Copied from my comment below:
            I’ve been reading comments here that Tesla can deliver Lithium storage for $250/kWh and predicts they will be able to reach $150/kWh in the next 5 to 10 years.
            $250 per kWh / 2,000 cycles / 80% = 15.6c/kWh
            $150 per kWh / 2,000 cycles / 80% = 9.4c/kWh
            I think the cycle life of Tesla Lithium batteries is actually greater than this.

            I think storage should be able to go to 5c/kWh before long.

            So that would be 6c/kWh for Solar used directly during the day, let’s say for 6 hours, and 6c+5c = 11c/kWh for stored solar the rest of the time.

            (6/24)x6 + (18/24)x11 = (1/4)x6 + (3/4)x11 = 9.75c/kWh averaged out to flat per hour cost over the day.
            That assumes perfectly well behaved insolation and power demand, which is not reasonable. It also does not include any rainy day power storage or generator use. That cost will probably have to be 50% or 100% higher.

            You are probably correct. Staying on the grid will be more cost effective for most in the continental US states. Still that doesn’t give a lot of wiggle room to the utilities.
            Also, I’m not sure your point about large volume purchasing is correct. Solar is already a commodity style product and Storage will be also. This will make it competitive and could even give it an advantage over large scale Solar+Storage.

            You are probably right, but I still think it’s going to be tight. If the utilities in some areas don’t want to play fair then things could change, imho.

          • Bob_Wallace

            I think SoCal is far, far less likely to undergo a move off the grid than Australia for one simple reason. Current governments.

            California is now firmly in the hands of Democrats and looks to stay that way. Democrats are far more likely to push corporations (utilities) to change. The current Australian government is aiding utilities in their resistance to change.

            California utilities are being forced to give up coal, to support renewables and to install storage. This, I suspect, will keep Ca utilities toward the front of the parade and keep the motivation to abandon the grid lower.

            Australia seems to be on route to cause a lot of people to cut the wire. It’s like the decisions are being made by a bunch of angry 80 year old guys who used to run the world and are now totally out of touch.

            Germany may start forcing people off the grid with their high electricity taxes. But I think Germany is smart enough to see what is happening and would likely pull some of the taxes away from electricity and put them back into the general tax system. The largest part of German electricity taxes have nothing to do with electricity. They (I think) linger from the days of taxing electricity in order to encourage efficiency. That mission is accomplished.

            Hawaii, I suspect, will get its act together and start turning to solar, wind and geothermal. It’s got to be so clear to everyone on the Islands that they are shipping huge amounts of money off the islands for imported oil. It’s not like they have their own fossil fuel industry fighting to survive.

            (I’m going to separate the politics from the numbers.)

          • Bob_Wallace

            It’s always going to be more expensive, per watt, to install rooftop solar than large array solar. Same is going to hold for storage. If that difference is large enough to cover the cost of distribution and utility profit then the financial reason for moving off grid won’t materialize.

            And, again, utilities will have sources such as hydro and wind that can be used when the Sun is down. Stored homemade solar can’t compete with electricity from wind farms.

            “The average monthly electric bill for residential properties in Hawaii was $203.15, the highest in the nation for 2012, according to recently released data from the U.S. Energy Information Administration (EIA). The average residential electric bill, by contrast, in New Mexico was $74.62, the lowest in the nation. In the contiguous United States, the South Atlantic region had the highest average monthly electric bill at $122.71, while the Pacific region (California, Oregon, and Washington) had the lowest.”


            Electricity is simply not a huge part of the monthly bill in most states. CA/OR/WA average less than $100 per month. And efficiency is likely to drop those costs.

            If one could save 50% of their electricity bill by going off grid I’m not sure many would in order to save $50 a month. The people with the tightest budgets for whom a $50 savings would be helpful probably don’t have the capital/credit to go off line.

            I suspect we mislead ourselves to some extent on sites like this. We tend to talk a lot about worst cases, about Australia and Hawaii, and then generalize inappropriately.

            Electricity, in general, is cheap energy. And utilities have the option to continue to provide inexpensive clean energy as soon as they “come to their senses”.

          • msd

            Thank you very much for the explanations. Makes a great deal of sense from both political and economic angles.

            Spot on with respect to Australia and out of touch 80 year olds. That one has been easy for me to scan and of course impossible to understand. I will be fascinated to see what happens in their next elections.

            Hawaii will definitely “get its act together”, the economics driving this will not be denied. I’m just not sure how smooth a process this will be. If I lived on Oahu then I’d be going to Solar and Storage. If HECO said no, then I’d figure out how to say goodbye to HECO. Maybe their situation will change for the better and managers of HECO will figure it out …but then there’s the example of Australia where nonsense reigns supreme …for now …so I don’t know if Hawaii will not see an off-grid revolt.

            Clearly Germany has done more than other country to bring solar costs down, but their solar resource is poor compared to the Southern US and they have far less percentage of summer solar in the winter than our Southern States. I do not see Germany as a good indicator of what is going to happen in the US. They are demonstrating you can solve a tougher problem with solar, wind, and storage on the grid, so maybe I am wrong.

            I’ve been watching the Abbott nonsense in Australia and thinking forward to our 2016 presidential election. The Republicans party is still trying to fight renewables, with very few exceptions. The money and motivations for this are the same as for Australia and I could see the same happening here. Your comments on California State politics and the economics of off-grid in California are very enlightening for me. (I need to update myself on state electricity prices.) I think you are correct and I have been generalizing inappropriately. The huge influence large corporations have on our government concerns me. I worry the large oil companies and utilities may be able to protect themselves from fair and reasonable competitive change, as is happening in Australia. This is definitely why I’m quick to suggest an off-grid revolution. In any case, the knuckleheads (as you say) will only be able to interfere for a short time. It will be interesting to see what transpires.

            Thanks again, mike

          • Bob_Wallace

            I’d caution about looking too hard at places like Australia and Hawaii and then generalizing to other places with less expensive electricity.

            Take a look at this list of EU countries sorted by cost of electricity in 2012. Germany is one of the most expensive. Look at all the countries where electricity is less than 10 euro cents. People in those places don’t have the Malta/German motivation to leave the grid.

            And this list of electricity prices by state…


            Hawaii is 38 cents. The next most expensive places are Connecticut, New York and Alaska at roughly 20 cents.

            The reports of people paying a lot in Ca are likely folks with high usage running into top tier rates. With some solar panels to handle most of their AC and pool heating (whatever is eating power) they would likely move their per kWh costs down low enough to make leaving the grid uninteresting.

          • Bob_Wallace

            Sorry, that’s the wrong image. It shows only the cost of electricity and distribution without taxes.

            This should be the correct page, sorted from most expensive to least expensive, 2012.

          • Vensonata

            Australia and Hawaii also have sunny winters…suddenly life is easy. Palaces like Arizona have 70% winter pv production of summer. Again how easy life would be to go off grid. By the way new thought about off grid ev charging: an I.c.e. car is a generator on wheels, yes? A hybrid is a generator and battery bank on wheels, yes? Well, shouldn’t we leave the generator at home and just drive the battery bank around? So even charging an ev off a generator off grid is higher efficiency than a hybrid vehicle.

          • Bob_Wallace

            Two issues:

            1) Cost. The price of utility solar is just below $2/watt while the cost of rooftop is just below $4/watt. The spread will likely decrease but bulk purchasing beats small volume purchasing. Same will hold for storage. Plus large wind turbines and hydro are not options for end-users.

            b) Convenience. The relatively small savings that might be enjoyed by the average person (not outlier situations such as Australia) won’t be enough to make most people put in the effort to install and maintain their own utility company.

            Can’t leave the generator at home with a 40 mile range PHEV and take a 100 mile drive. That’s the point of packing a generator under the hood.

            Wind is now (apparently) about 3.5 c/kWh. Running a generator costs money. I haven’t done my math but someone else’s claim of 50 c/kWh doesn’t sound unrealistic.

            Just rough math for me. A 2.5 kW gen (don’t know if it actually produces that much when running. About a quart of $4/gallon gas. That’s very roughly 40 cents per kWh. It doesn’t include generator costs and losses.

          • vensonata

            Absolutely, generator electricity is at least 40cents U.s> in Canada 60C. However I wasn’t suggesting a hybrid car but a 100 mile range ev. Occasionally charging in winter at 40centkw would put you equivalent to a gas mobile in price…but the charging with generator is only when not overproducing solar. As well you can often find an ev charge in town these days. But these are the considerations I have to weigh in deciding to go 100% ev or Hybrid,but it seems senseless to have a generator under the hood instead of in my generator shed.

            I am finding it helpful to my imagination to think about vehicles as generators on wheels…or perhaps off grid houses on wheels…it allows me to revise some neuronal circuitry.

          • mds

            Mint, link to video on Tesla Tech:
            Thanks for discussion. Chao Mike

          • eveee

            Utilities won’t go bankrupt? Read the headlines.

            Utility’s bankruptcy prompts consumer worries in Texas


            I didn’t even try hard to find that one. Just google “utility bankruptcy”.

            Pacific Gas and Electric filed for bankruptcy.

            Maybe you could attend the 21st Utility Bankruptcy Conference.


            This is from 1985, so don’t panic.

            “For years, electric utilities nationwide have struggled to pay for nuclear power plants with out-of-control price tags. Now, the financial woes of several utilities, all in the nation`s midsection, have raised the possibility that, for the first time since the Depression, an investor-owned public utility will seek protection from creditors under federal bankruptcy laws”


          • Mint

            I very clearly distinguished between ‘utilities’ that own the grid and ‘generators’ that produce electricity. People using ‘utility’ for the latter doesn’t change my point at all, but congrats on winning a semantic battle.

            As for PG&E, did you read anything about the case? They went bankrupt because flawed regulation forbade them from raising rates to cover costs.

            Obviously my statement of “rates will go up” and everything related to it doesn’t apply in such a scenario.

          • eveee

            Lets see. PGandE owns transmission. It went bankrupt. So there is a utility that went bankrupt that owns transmission. So that semantic distinction does not matter. Who did you say was being semantic? Ok. Next. A flawed regulation forbade them from raising rates…. and everything related to int doesn’t apply in such a scenario.

            “”Anyway, the point of my post was that utilities aren’t going bankrupt. They’re merely going to change pricing.””

            I get a general sense that what you are saying is they go bankrupt to restructure and start over, so that most never really expire.

            Who’s being semantic?

            Yes, its picky. I don’t like inaccurate statements in blogs and that bugs people. Judging from the 21st annual Utility bankruptcy meeting, its not that uncommon. Its also interesting that so many utilities were threatening bankruptcy in the 80s when nuclear construction costs were way over budget and that stretched the utilities thin.

            I accept that you added qualifications. Adding one after the fact to PGandE…..
            So Utilities do go bankrupt even ones with transmission. And we might be better off with a public system. And it is possible that they could fail and sell to the state, altho probably unlikely. One thing the utilities know for sure is monopoly power. They would have to be desperate to do that, but that might just happen. With enough stranded capacity, the transmission system may be their only bargaining chip.

          • Mint

            I said this:

            “Anyway, the point of my post was that utilities aren’t going bankrupt. They’re merely going to change pricing.”

            Your PG&E example boils down to this: “Sometimes they’re not allowed to raise prices, so they go bankrupt”

            If you feel proud for pointing out this technicality, good for you. But most people live in areas where the utilities can indeed raise rates, subject to caps on profit.

    • spec9

      If you go off grid then it is going to take a long time to charge up you car and/or burn out your home’s batteries.

      • Vensonata

        Ah yes, off grid ev charging. It needs some thought: if you park at home in daytime, no problem charging directly, many do it that way. If you park at work, then you need on grid charging. If you can’t charge at work, and you arrive home and want to charge at night you need battery storage to charge your ev battery. It will likely be a used lithium ev battery which is perfect for just such re use. There will be a lot of used battery packs that are still 70% useful. That is the symbiosis between EV’s and off grid battery banks. Love to hear better ideas though!

      • mds

        Not true. Tesla is using the same Lithium battery technology for homes, sold through SolarCity, as they are at their super-charger stations. Watch this video:

        Lithium ion batteries have taken over the EV/PHEV industry because they have deep-cycle life that is far superior to NiMH or Lead-acid. Thousands of deep-cycles compared to 100s or 10s. 3,000 deep-cycles is typical for Ferrite Lithium ion. Check out specs for Stark Power 12V batteries.

        Solar charge those batteries during the day. Charge your EV while you sleep at night. …and cost of doing this is dropping rapidly.

        This is probably already a no-brainer in Hawaii and Australia. Southern California will be next.

        • Bob_Wallace

          Trojan T-105 RE.

          4,000 cycles at 80% DoD. (Using only the ‘top 20%.)

          Your Starkpower batteries. The graph goes out only to about 2,000 cycles and capacity is down to the 85% range.

          • mds

            I stand corrected. Thank you.
            Makes the point that home charging of EV/PHEV is not a problem even stronger.

          • Bob_Wallace

            Let’s start with the cost of the power coming from your solar panels. Would $0.12/kWh be a fair number?

            Storing in the batteries I’m using costs about $0.15/kWh. Add in 10% loss for panel -> batteries and a couple percentage loss for batteries -> AC grid level.

            12c + 1.2c + 15c + 0.6c = 28.8 cents to charge your EV/PHEV off your own solar panels via storage batteries.

            Assuming you can generate your own at 12 cents.

          • GCO

            You surely meant 4000 cycles at 20% DoD (going from 100% to 80% SoC). At 80% DoD, their typical life drops to ~1000 cycles.

            I only have data for Winston/Balqon’s LiFePO4 cells handy: 7500+ cycles at 20% DoD, 2000 cycles at 80% DoD (even 3000 for large cells) = twice as much as Trojan’s.
   page 4.

            So yes, at least some Li-ion easily beat even the best lead-acid on cycle life. Because of their higher cost though, they currently aren’t more economical per cycle.

          • vensonata

            Geez, it really is nice to have a free engineer on hand! Nice calculations. So finish the calc’s: what is the bottom line in cost per kwhr?

          • vensonata

            Let me try using the figures quoted (which seem accurate to me). The Balqon 36kw pack at 20% =7.2 kw x 7500cycles= 54,000 kwhr lifetime. Cost $12,500. 12,500 divided by 54,000 = 23cents kwhr. hmmm thats a bit pricey. What do you get?

          • GCO

            Yeps, that’s why I said lithium still usually remains more expensive as lead-acid, although the extra convenience (no watering, longer life), higher efficiency and better low-temperature performance might be worth the extra $.

            The best bang/buck I get is using their 15 kW⋅h pack at 50% DoD:
            5.3k$ / (5000 * 7.5 kW⋅h) = 14 c/kW⋅h

            Maybe using a combination of LiFePO4, which has a pretty sweet spot around 1/3 ~ 1/2 DoD, and lead-acid for more rarely used capacity, gives you the cheapest storage?
            You’d have to deal with two chemistries though => can’t directly use in parallel, separate charge controllers…

          • Bob_Wallace

            I went through the exercise of whether to pay the same or a bit more per useful kWh and get lithium batteries or save a few dollars now and purchase a lead-acid pack, knowing that I’d have to swap them out sooner.

            What swung me to lead-acid is that when this set wears out in about ten years the price of some alternative battery is likely to be considerably cheaper than the hypothetical set of lithium batteries I’d still be using.

            So I save some money now and I expect I’ll save a lot more money later.

          • Vensonata

            Thanks. Perhaps irrationally I am drawn to lithium over lead acid even at a slightly higher price, because although the advertised cycle life of lead acid is fairly accurate, the charging stages can make it incredibly inefficient in the last 15%, which is where my battery spends most of its time. I like the acceptance of lithium…stuff it in as fast as you want up to 98%. And oh so important off grid lithium does not need full charging! Lead acid is not happy with anything less than 105%,or it begins to decline rapidly, and again terribly inefficient to run generator at low peed to trickle charge lead acid. So bottom line lithium wins

          • Vensonata

            Update: new figures after closely, very closely, looking at Balqon specifications on the 36kw pack: 5000cycles at 50% depth of discharge! So 18 kwh x 5000 = 90,000kwhr. Price $12,500. Price per kwhr 13.9 cents! Now with all that hardware and software and casing included that beats lead acid by a mile, I think.

          • mds

            I don’t see their 36kWhr pack. Your math is good assuming the input numbers are correct.
            Balqon 18kWhr pack $6,650 3,000 cycles at 70% DOD
            $6,650 / 18kWh = $369.44/kWh
            $369.44/kWh / 3,000 cycles / 0.7 = 12.3c/kWh / 0.7 = 17.6c/kWh
            Why would you only run a Lithium pack down to 20% DOD? Saving for a rainy day?

          • Vensonata

            See my new figure above. Bottom line new calc. 13.9 cents kwhr Balqon 36 kw pack all inclusive $12,500.

          • Bob_Wallace

            ” (Using only the ‘top 20%.)”

            I should have said 20% DoD or 80% SoC (state of charge).

          • mds

            OK, so you need 4 Trojan lead-acid batteries (12V 100Ah or about 1kWh) cycling to 20% to equal 1 of the Stark Power Lithium Ferrite batteries (12V 100Ah) cycling to 80%. Trojan lead-acids are going to be more cost effective. I’m guessing 4 x about $100 compared to $899 for the Stark batteries. However, you should be able to find Lithium Ferrite batteries from other sources at closer to $400/kWh hour, which would make cost about even. Then comments from Vensonata just above come into play and the Lithium batteries are going to be the better choice.

            btw I’ve been reading comments here that Tesla can deliver Lithium storage for $250/kWh and predicts they will be able to reach $150/kWh in the next 5 to 10 years.
            $250 per kWh / 2,000 cycles / 80% = 15.6c/kWh
            $150 per kWh / 2,000 cycles / 80% = 9.4c/kWh
            I think the cycle life of Tesla Lithium batteries is actually greater than this.

          • mds

            whoops. That was 4,000 cycles down to 20% for the Trojans. So twice the life, or half the cost, depending on how you want to look at it.

            btw That is 20% DOD, not 80% DOD.

  • JamesWimberley

    “Grid defection doesn’t have to 100% either; many early adopters could have home energy systems using renewables and remain grid connected in order to have a backup power system.”
    They should pay for this service, right? And it will become a substantial charge. As the marginal cost of producing electricity falls to zero, both on- and off-grid, most of the payment will logically shift to a monthly fixed charge.

    • sault

      “As the marginal cost of producing electricity falls to zero, both on- and off-grid, most of the payment will logically shift to a monthly fixed charge.”

      Crap, this is going to do wonders for promoting energy efficiency.

    • Ronald Brakels

      The fee for being connected to the grid can’t become a substantial charge as someone with sufficient solar panels and home energy storage can simply buy a one kilowatt generator, or a 600 watt generator, and run that if they need extra power. Since they have a battery bank they can get by with a tiny generator and just use it to charge the batteries. There is no need for it to be large enough to meet household peak demand. The good new is that it doesn’t cost much to maintain an existing grid in a town or city. Once it looks like a significant number of people are in a position to save money by dropping of the grid It will be necessary for electricity retailers to have no or low fixed charges to maximise their revenue.

      Of course, if you live in rural Austalia their attitude will be, “Crikey! Haven’t you dropped off the grid yet?” As electricity is supplied to farms and rural communities at a loss here.

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