Financial Viability of Residential Photovoltaic and Battery Systems in California

8 Pages Posted: 31 Mar 2017

See all articles by Jonas Lehr

Jonas Lehr

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich

Evangelos Vrettos

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich

Rishee Jain

Stanford University

Ram Rajagopal

Stanford University

Martin Everts

Axpo Holding AG

Date Written: March 29, 2017

Abstract

Using a battery on a household level has become easier after the launch of Tesla’s Powerwall. Storing electricity during daytime’s PV overproduction or charging the battery during night with an attractive tariff are the most prominent applications. This paper explores the economic impact of the usage of residential battery storage combined with solar photovoltaics (PV) based on real load data from Northern California, USA. A data-driven, deterministic model to benchmark electricity cost savings for single households is presented and the financial viability of such systems is scrutinized for California. Our results indicate that under current capacity and price points, battery systems have limited financial viability and have a payback period exceeding 20 years in most cases. We deepen our analysis and compare the results of our deterministic model to that of a stochastic model to demonstrate that for an hourly time resolution the deterministic model provides an adequate benchmark for estimating cost (within 3%) savings with a short (1/60th) computation time.

Suggested Citation

Lehr, Jonas and Vrettos, Evangelos and Jain, Rishee and Rajagopal, Ram and Everts, Martin, Financial Viability of Residential Photovoltaic and Battery Systems in California (March 29, 2017). USAEE Working Paper. Available at SSRN: https://ssrn.com/abstract=2943001 or http://dx.doi.org/10.2139/ssrn.2943001

Jonas Lehr

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich ( email )

Zürichbergstrasse 18
Zurich, 8092
Switzerland

Evangelos Vrettos

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich

Zürichbergstrasse 18
Zurich, 8092
Switzerland

Rishee Jain

Stanford University

Stanford, CA 94305
United States

Ram Rajagopal

Stanford University

Stanford, CA 94305
United States

Martin Everts (Contact Author)

Axpo Holding AG

Parkstrasse 23
Baden, CH-5401
Switzerland

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