The cost of rooftop solar power plus battery storage could drop below the price of the average electricity bill in Germany, according to a new analysis by HSBC investment bank.
Moreover, HSBC found that “the process of re-localisation of power production appears unstoppable.” Power generation systems with a capacity of 10 megawatts or less already account for 30% of Germany’s power, and HSBC expects that to climb to 50% by 2025. Household battery-based storage of solar power is expected to account for the bulk of this. What’s more, Germany’s citizens already own just over half of the nation’s renewable generation capacity.
Battery storage is increasingly being used for home solar systems, to be able to store excess power and use it when needed, like at night. Improvements in both battery and solar technology, as well as economies of scale, are expected to continue to drive costs down in coming years.
HSBC has concluded that the overall cost of a home solar system with battery storage will drop below the equivalent cost of residential grid electricity before the end of this decade in Germany. Further, another recent analysis by UBS investment bank estimated that small solar-plus-battery systems will become so affordable in Europe that it will become economically unviable to build any new fossil fuel-based power plants.
After this happens in Germany, how long before this situation spreads to other countries? Yet another recent analysis, by Citigroup, has predicted that the payback for rooftop solar with battery storage will, by the end of this decade, beat the payback on solar-only systems now. It’s clear that solar plus storage is really going to give fossil fuel-based power, and traditional power utilities, a run for their money sooner than many people realise, and not just in Germany.