It’s a chance to work with policymakers to find creative solutions to meet corporate renewable and emissions goals and, at the same time, offer employees resilient solar PV + storage to support their productivity.
It was not until the threat of COVID-19 convinced me to move in with my in-laws that I fully appreciated how the value of backup power extends beyond mere comfort and convenience.
I am among countless people who have retreated from cities in the wake of virus. Tropical Storm Isaias recently knocked out power to more than 2 million people in the northeastern U.S. and Canada, with many of those impacted in suburbs.1 Aside from essential personnel, many of those fortunate to still be employed during the pandemic now work remotely and depend on their local power grid to remain productive—their employers depend on the grid, too. Indeed, extensive residential outages now have an increased effect on personal and business productivity, not just on convenience, comfort, safety, and communications.
But the post-COVID economy also creates an opportunity for employers with newly remote workforces. It’s a chance to work with policymakers to find creative solutions to meet corporate renewable and emissions goals and, at the same time, offer employees resilient solar photovoltaics plus storage (PV + storage) to support their productivity.
My in-laws live in a rural apple-orchard community outside of Rochester, NY. I grew up in Westchester County, NY, the suburbs of Manhattan. I am no stranger to brownouts and the once-every-few-years major blackout, but I have been fortunate that losing power has not been significantly detrimental.
Once the in-laws realized we were going to be in town for, let’s say, quite a while, I went through a mandatory training to learn how to fire up their gasoline-powered generator. To turn it on, we went through the process of rolling the 150-pound beast out of the garage, priming it, starting it with a pull cord, and then plugging it into the breaker box (after shutting off non-essential circuits). Only then could we listen to the 70-decibel purr of 6.25 kW of power and experience the sweet aroma of gasoline exhaust wafting into the air. The process forced me to wonder why two retired teachers in reasonably good health with a wood-fired stove and gas grill, who had lived for 40 years without air conditioning, felt the need to buy and maintain a USD 700 generator. For what, Netflix during an outage?
It turns out my in-laws, along with 13 million other Americans,2 are on well water, and the water pump is electric. I had to check my cynicism and recognize that while I often think of electricity providing convenience and comfort (lights, TV, air conditioning), it is essential for safety (water, medical equipment), health (refrigeration), and of course, productivity (computers, internet, communications). We rely on electricity more than ever, and in North America expect it to double as a percent of total energy use by 2050.3
Despite the memorable news coverage of major storms and other events that cause mass outages, the frequency of total outages in the U.S. has remained relatively flat over the last decade and outage durations have decreased. Approximately 80% of outages from 2008 to 2017 lasted less than 4 hours (see Figure 1) and only about 6% of the U.S. population experiences an outage each year. Nevertheless, outages of any duration are impactful, and all outage durations are uncertain when they begin. It is only through the benefit of hindsight that they can be judged as minor inconveniences or major impacts.
Figure 1: Outage frequency and average duration (left), count of typical outage durations (right), 2008 – 2017 in the U.S.4,5
Major or minor, outages can be mitigated through the use of onsite power generation. My new expertise in gasoline generators now allowed me to perform a back-of-the-envelope comparison between gasoline generators and PV + storage.
Table 1: Comparison between home generation and backup products
* This table is purely illustrative; all numbers are approximated and ignore state and local incentives; note many companies offer financing and service packages for these products.
+ ITC: Federal investment tax credit for 2020 is 26%; PV size 7 kW dc at USD 3/W dc; USD 9,000 for a battery, installed.
++ Grid service opportunities vary significantly by state and utility territory based on program availability and market rules.
It is easy to see that a generator is unmatched on price. The generator appears better in terms of reliability and duration, but this assumes proper maintenance to keep the generator in good working condition and a sufficient supply of gasoline readily available. As noted in Figure 1, most U.S. outages last less than four hours, indicating a single typical residential battery can meet that need, especially during days with ample solar production. PV + storage fares better in comparison to a gasoline generator in such less tangible categories as low maintenance, automated transfer during outages, no emissions, no smell, no noise, and a longer warranty.
On paper, the less tangible metrics might seem to pale in comparison to the difference in price. Yet the market tells a different story.
"PV + storage is the only product that can protect you from global warming induced outages while simultaneously reducing your emissions that contribute to global warming in the first place!"
Price is clearly an important but not the only determining factor in consumer decisions relating to backup power, as evidenced by the data relating to increasing storage attachment rates to new PV sales amongst the top residential PV installers in the U.S.:
- Sunrun, the largest residential PV installer by megawatts per year8 stated more than 20% of its new PV sales now include storage9, 40% in California;10
- SunPower, a top solar installer, stated 30% of its California sales include storage;11
- Sunnova, a top solar installer, stated its national storage attachment rate was 34% in Q2 2020 (up from 11% in 2019);12
- Tesla reported Q1 2020 attachment rates of 40%;13 Tesla sells its Powerwall residential storage product itself and also through installers that include Sunrun and Sunnova;
- In Hawaii, where many small, local installers operate, 73% of new solar system sales included batteries in 2019. Hawaii, of course, has other structural reasons for such a high attachment rate, notably electricity rates two to three times the national average and policies that restrict the export of electricity from rooftop PV systems to the grid;
- When U.S. solar installations hit 1 million customers in 2016, attachment rates were near zero.14 U.S. solar installations eclipsed 2 million customers in May 2019.15
Increasing storage attachment rates boosts an important revenue stream for solar companies. Residential solar installations are expected to remain relatively flat this decade, but residential storage sales are expected to grow more than 5x, with an attachment rate approaching 80% by 2030.16 Storage owners also will be able to earn revenue by sharing their battery capacity with grid operators, who are increasingly willing to pay for the flexibility storage can offer.17
Storage is now a permanent fixture associated with rooftop solar, providing value to both buyers and sellers across numerous dimensions. With global warming inducing stronger storms,18 and COVID-19 forcing more people to work from home, the need for clean and reliable residential electricity will remain in high demand.
As the post-COVID-19 world emerges, many large employers will have committed to a permanent shift in the economy, allowing personnel to work from home more frequently and even on a permanent basis.19 Those employers, many of which have 100% renewable energy aspirations,20 unlike the major employers of my in-laws’ generation, can reach their goals by pushing policymakers to incentivize PV + storage backup generation and help remote employees to improve their grid reliability. That could be a boon to the PV + storage industries — clean and reliable energy in the form of rooftop solar and storage to support a safe and productive (remote) workforce.
4 Eaton Blackout Tracker data, https://switchon.eaton.com/plug/blackout-tracker
8 Sunrun announced its intent to acquire the second largest US residential PV company, Vivint, in July 2020: https://www.greentechmedia.com/articles/read/sunrun-announces-acquisition-of-vivint-solar
9https://www.greentechmedia.com/articles/read/sunrun-keeps-growing-while-prepping-for-a-whole-new-business and https://www.greentechmedia.com/articles/read/sunrun-second-quarter-earnings-operations-installations-slow
17 https://www.sunrun.com/home-solar-blog/home-solar-and-batteries-can-replace-retiring-gas-fired-power-plants-los-angeles and https://electrek.co/2020/04/07/tesla-virtual-power-plant-powerwall-report/ and https://www.utilitydive.com/news/project-soleil-sonnen-pacificorp-rmp-batteries-solar-dive-awards/566230/
20 Google, Microsoft, Morgan Stanley, JP Morgan, Capital One, Facebook, Salesforce, and Amazon have all extended work from home policies and are in the RE 100 or have otherwise stated 100% renewable energy goals.