When architect Richard Schuh installed solar panels on his Mayacamas Mountains home in northwestern California two decades ago, going completely off the grid wasn’t a real consideration. He just couldn’t quite abide the banks of ugly lead-acid batteries he would have needed to store that amount of excess solar power. Today, it’s a different story. Two sleek Tesla Powerwall lithium-ion batteries hang inconspicuously on a carport wall, ready to supply nearly all the energy his home needs, even during blackouts.

“They constantly interface with the grid and with the solar panels to optimize usage,” says Schuh. “It’s a very smart system.” The software that manages the connections between the grid, panels, and batteries keeps the transitions from one to the other seamless. Schuh says his family doesn’t notice when it switches from solar to backup power at night, or even when the grid goes down. “The system does it all for us,” he says, adding, “If we had a larger system, we’d be completely independent.”

Tesla is one of a handful of companies (others include SolarEdge, Enphase, LG, and Sonnen) that manufacture smart home energy storage systems that deploy power when needed. This solar-plus-storage solution is set to revolutionize the home energy market and could at long last bring the power of the sun into homes simply, safely, and steadfastly.

Lithium-ion batteries have made these systems possible. More expensive than lead batteries upfront, they last much longer and store far more energy. They’re also sleek and unobtrusive, not bulky eyesores. Increased demand for them in everything from mobile phones to electric cars has brought the price down by 85 percent in the last decade, making them a much more popular way of powering a home.

Price tends to be consistent among brands. The biggest differentiators are design, capacity, battery life, and software. “A residential battery in the range of 10 to 20 kWh costs between $8,000 and $15,000,” says Barry Cinnamon of Cinnamon Energy Systems, a Silicon Valley solar and battery installation company. To power a 2,200-square-foot home with Tesla Powerwalls that can each hold 13.5 kWh, including the ability to charge your car and run your AC, you could use three at a cost of just over $20,000, without installation.

“But you don’t need a giant system,” says Cinnamon. “As long as the sun comes up the next day, your batteries will recharge, and you’ll have power.” And the smart systems can save you money on the power you draw from the grid. “In California, where electricity rates are lowest during the early part of the day, you can buy cheap electricity from the grid then and save the solar energy in your battery for when electricity is more expensive,” Cinnamon says.

“The bottom line has been the satisfaction of self-sufficiency. It’s an amazing feeling in a time when things are increasingly vulnerable.”
—Richard Schuh, architect

This type of time-of-use program has saved Schuh a significant amount of money on his power bill—he’s now spending just $100 a year (including powering two Tesla Model S vehicles). But for Schuh, the financial benefits of battery backup are just gravy. “The bottom line has been the satisfaction of self-sufficiency,” he says. “It’s an amazing feeling in a time when things are increasingly vulnerable.” (According to an industry report, public-safety power shutoffs associated with California wildfires have prompted a rush on residential solar with storage.)

While time-of-use programs can help offset some of the cost, it’s only once energy companies recognize the potential of residential power storage as a way to manage the grid, and then start subsidizing them, that a real sea change will likely occur. A network of home batteries, for instance, can be a virtual power plant, tapped into and deployed automatically based on grid needs. Some of this is already happening: Green Mountain Power in Vermont has started subsidizing Tesla Powerwalls; National Grid has programs in Rhode Island and Massachusetts that pay customers with battery storage to draw on their excess power.

“Today batteries are one of the most flexible resources we have on the energy grid,” says Josh Castonguay, Green Mountain’s chief innovation officer. By tomorrow, he speculates, they will be essential to our greener, smarter homes. A home battery integrated with a smart electrical panel that could balance your energy needs and let you categorize and prioritize your loads is truly a sign of a smart home, he says. “Just tell the system how you want the house to operate day-to-day or in the event of an outage, and then just let it do its thing.”

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