By Jason Deign
German storage player Sonnen today became the latest major player to join the race for supremacy in Australia’s increasingly crowded residential energy storage market.
The company is looking to attract Australians to its sonnenBatterie product, which is a modular lithium-ion battery system capable of storing between 2kWh and 16kWh per household.
“Our first partner is True Value Solar, Australia’s largest solar company,” confirmed Mathias Bloch, Sonnen spokesman.
The company threw its hat into the Australian ring in the week after LG Chem and Enphase Energy both unveiled news of growing demand for storage products across the country.
LG Chem said it expected to see a five-fold increase in Australian shipments this year, to 3,000 units, and Enphase Energy was reported to be looking to Australia and New Zealand for the bulk of up to USD$20m in sales.
US microinverter maker Enphase expects to ship around 4,000 storage systems this year and said it will start generating revenues across the antipodes by the second half of 2016.
Redflow readying consumer product
The Sonnen, LG Chem and Enphase announcements come hot on the heels of news that Redflow, the Australian flow battery maker, is readying for a consumer product launch any day now.
Redflow’s zinc bromide flow battery “is very competitive in the residential space against the lithium-ion chemistry from companies like Tesla,” said marketing manager Sciobhan Leahy.
“We make the world’s smallest flow batteries, by a factor of 80%, similar to the size of a domestic reverse cycle air conditioning unit, and designed to be placed outside in a similar location.”
The big lure for Enphase, LG Chem, Sonnen and Redflow, alongside established battery system vendors such as 360storage, Sunverge and Tesla, is the massive growth predicted for the Australian home storage market.
Last year Morgan Stanley reckoned Tesla’s arrival could trigger the onset of a home storage market worth $18bn, covering 2.4m households.
PV-and-battery systems at home
And IHS predicts residential energy storage will double in size every year until 2018, by when around 30,000 Australians should have PV-and-battery systems at home, totalling 200MW and 250MWh.
“This increase now places Australia in the top five markets for distributed energy storage in 2016, behind the United States, Japan, Germany and the United Kingdom,” said the analyst firm.
Other forecasts are similarly bullish.
The Australian Climate Council, for example, recently estimated that household and commercial battery storage capacity would grow 10 times, from 90MW to 900MW, in the four years between 2014 and 2018, according to Sonnen.
The Council estimated half of all households would have battery storage installed by 2030, a market worth $24bn.
Installers are getting five or 10 calls a day
Right now, said Australian Renewable Energy Agency (ARENA) CEO Ivor Frischknecht: “It’s not like we’ve got hundreds or thousands of systems flying out the door, but installers are getting five or 10 calls a day each.
“That’s pretty good considering we only started [seeing interest in storage] a few months ago.”
Australian residential storage looks set to cross a tipping point later this year as increased competition drives down the price of battery systems. “It’s not terribly economical yet, but it’s not un-economical either,” Frischknecht said.
However, he noted: “There seems to be a glut in capacity in lithium-ion in China, so we’re expecting a 50% drop in price in the next year.”
An imminent drop in battery prices makes grid defection a very real prospect for Australian homeowners, who are not exactly noted for their love of electricity companies.
Shake-up in Australian utility models
This threat, in turn, is leading to something of a shake-up in utility models across Australia.
Sydney-based electricity provider AGL Energy, for example, has adopted an ‘if you can’t beat ‘em, join ‘em’ approach and is offering its own residential storage kits after investing $20m in Sunverge last month.
Meanwhile ARENA is backing an independent energy retailer called Mojo Power, which has ripped up the utility rulebook and is aiming to sell electricity at cost, for a fixed monthly fee, while encouraging users to take up solar.
Mojo “has the potential to accelerate the growth of Australia’s emerging battery storage industry as consumers look for more value from their rooftop systems,” said Frischknecht in a press note.
A rosy future for residential storage
Meanwhile, other signs all point to a rosy future for residential energy storage in Australia.
The results of a three-year residential battery trial by Australian network provider AusNet Services, for example, have shown that both utilities and consumers can save money with storage.
And the Australian Tax Office has this month ruled that drivers of electric vehicles can claim the same deductions for business use as drivers of traditional cars, which should provide a boost for sales.
Given these signals, and the rampant rates of growth already predicted for the market, it seems Australian storage will hardly need Mojo’s help to go mainstream.