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Making batteries and arbitrage work, selling back at peak rates

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  • Making batteries and arbitrage work, selling back at peak rates

    Well, here it goes.

    Wife and I are finally making the jump to installing solar ( mainly we want the 30% credit in Cali before it runs out and/or diminishes ) and I'm trying to figure out if installing batteries ( cuz I'll get 30% PLUS $250/kWh rebate if I do it ) makes any sense at all.

    Some background: We will be on a grid tie system. Batteries - if purchased - will be used simply as storage from pv system during off peak to sell back to the grid during on peak. There is no plan to try and turn the battery system into a blackout system. I have plans to install a generator for that down the road.

    We are fairly heavy power users - live near Modesto, Ca - and so use lotsa a/c during the summer. Our typical yearly consumption is around 11,000kWh/year. I've already consulted with one sales guy, and asked him about the viability of using electric radiant heaters to heat during the winter, rather than forced air, so he added on another 2,000kWh/year to size the system, making it 13,000kWh/yr, or a 8.85kWh system.

    By checking PG&E's website, and establishing our use pattern, it looks like we would be able to overproduce for our daily needs during the summer by around 2,500 kWh. Daily, during the summer, we should be able to store around 35kWh during off peak, then dump it into the grid at peak prices. Pricing is currently $.28/.38. I plan on charging the batteries through solar only.

    Here's where I'm hitting the rocky road. My selling point is $.38/kWh. Should I use $.28/kWh as my generation figure? Or should I use the $.12/kWh that the sales literature said will be my 25 year cost of power generation?

    I'm attaching a couple of pics. One is from the sales dude of our yearly usage and production. The second is a typical summer's day hourly use pattern - you sure can tell when the a/c kicks on lol.

    So, best case would be to daily produce 35kWh at $.12, then sell it at $.38, 5 days per week.

    35 (kWh) x .26 (.38-.12) x 5 (days per week) x 26 (weeks in 6 months ) = $1183 net.

    A FLA battery system, if you shop, and diy the ****e out of it ( which of course means not attractive and a low Wife Acceptance Factor ) can be installed for around $200/kWh. Wholesale Solar has a 60kWh system for around $10k plus $2k for install and cables, chiropractor visit, etc.

    So. if I'm looking at this right, it looks like 10 years to pay it off?

    Around 12k expense and 1.2k/yr net?

    This being the case, why would anyone get batteries?

  • #2
    > So, best case would be to daily produce 35kWh at $.12, then sell it at $.38, 5 days per week.

    This statement makes no sense - can you clarify it ?

    if you are NOT going to use batteries for backup, you cannot make $ wearing them out with daily sell-back cycles. replacement batteries will eat all your sales $
    Powerfab top of pole PV mount (2) | Listeroid 6/1 w/st5 gen head | XW6048 inverter/chgr | Iota 48V/15A charger | Morningstar 60A MPPT | 48V, 800A NiFe Battery (in series)| 15, Evergreen 205w "12V" PV array on pole | Midnight ePanel | Grundfos 10 SO5-9 with 3 wire Franklin Electric motor (1/2hp 240V 1ph ) on a timer for 3 hr noontime run - Runs off PV ||
    || Midnight Classic 200 | 10, Evergreen 200w in a 160VOC array ||
    || VEC1093 12V Charger | Maha C401 aa/aaa Charger | SureSine | Sunsaver MPPT 15A

    solar: http://tinyurl.com/LMR-Solar
    gen: http://tinyurl.com/LMR-Lister

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    • #3
      Originally posted by Mike90250 View Post
      > So, best case would be to daily produce 35kWh at $.12, then sell it at $.38, 5 days per week.

      This statement makes no sense - can you clarify it ?

      if you are NOT going to use batteries for backup, you cannot make $ wearing them out with daily sell-back cycles. replacement batteries will eat all your sales $
      Well, that's the point of the post.

      Am I correct that including batteries is a waste of money, since that's the best case scenario?

      Comment


      • #4
        Originally posted by Harok375 View Post

        Well, that's the point of the post.

        Am I correct that including batteries is a waste of money, since that's the best case scenario?
        Batteries are not always a "waste of money" but for most people it will cost more to generate a kWh from a battery system then to purchase it from your POCO. So it seems to be a financial mistake to make.

        Places like Hawaii seem to muddy the waters when it comes to batteries since their POCO's are charging a lot more then other POCO's.

        Comment


        • #5
          Before you go further, do some homework. You seem to be under a lot of perhaps mistaken assumptions. Start with POCO rules as they may impact those assumptions about buy/sell/net metering arrangements and know that things are likely to change in the future.

          Comment


          • #6
            Originally posted by SunEagle View Post

            Batteries are not always a "waste of money" but for most people it will cost more to generate a kWh from a battery system then to purchase it from your POCO. So it seems to be a financial mistake to make.

            Places like Hawaii seem to muddy the waters when it comes to batteries since their POCO's are charging a lot more then other POCO's.
            Agreed on it not necessarily being a waste to some

            1- they might want to use it as an emergency supply - I looked into this, and for us, not an option, since the likely outage event will be a rolling blackout during the hottest part of the day. A/C use would drain all but the largest battery system, plus you've got inverter sizing to handle inrush amps, etc. Not worth it for us.

            2- may be a tinkerer and don't care

            3- etc.

            From my VERY basic analysis, it looks like about $20/kWh storage for every expected year of life is about the break even point

            Comment


            • #7
              Originally posted by J.P.M. View Post
              Before you go further, do some homework. You seem to be under a lot of perhaps mistaken assumptions. Start with POCO rules as they may impact those assumptions about buy/sell/net metering arrangements and know that things are likely to change in the future.
              Well, we'd be put on net metering 2.0 , which is time of use rates.

              What am i missing

              Comment


              • #8
                Originally posted by J.P.M. View Post
                Before you go further, do some homework. You seem to be under a lot of perhaps mistaken assumptions. Start with POCO rules as they may impact those assumptions about buy/sell/net metering arrangements and know that things are likely to change in the future.
                Ahhhhhh.

                PG&E will control if and when your battery power is dumped onto the grid?

                Comment


                • #9
                  Originally posted by Harok375 View Post
                  ...........
                  PG&E will control if and when your battery power is dumped onto the grid?
                  Also to take the Federal Tax credit you have to charge your batteries from solar which means those kWhrs will not get credited at $0.35 per kWhr. The best you could due is offset loads at $0.35 per kWhr less inverter/charger inefficiency and wear and tear on your batteries. That is negative arbitrage.

                  Comment


                  • #10
                    Originally posted by Harok375 View Post

                    This being the case, why would anyone get batteries?
                    Because they want to live off grid or where grid tie power is not available. if you have GT, then batteries are typically not economically a good move.

                    Comment


                    • #11
                      You have to 'value stack' to justify the cost of batteries. They're generally not going to be worth the cost simply due to arbitrage or backup or ease of maintenance vs a generator or the peace of mind that you don't need to hunt for fuel if there's an extended outage. But you add all of it together and they start to make sense.

                      Personally I got a small-ish 20kWh bank of cheap lead-acid batteries because if there's a civil emergency I want to be able to use my solar array. A generator is cheaper but you could end up like this;

                      Screen Shot 2019-08-16 at 8.22.39 PM.png

                      Comment


                      • #12
                        Originally posted by khanh dam View Post
                        Because they want to live off grid or where grid tie power is not available. if you have GT, then batteries are typically not economically a good move.
                        One notable exception is a location like Hawaii, with the following features:

                        1. Very expensive grid power (all fuel must be imported to the islands). Ranging upward from $.50 per kWh.
                        2. Large solar PV penetration (approaching 50% of grid capacity in some areas) which require POCO control of PV sellback to maintain grid stability. As one result new PV installs may not be allowed to sell back at all, and have to use batteries if they want to make use of excess PV generation during peak sun hours.
                        SunnyBoy 3000 US, 18 BP Solar 175B panels.

                        Comment


                        • #13
                          If only the natives in Hawaii would use the geothermal resources under their feet they would have reliable independent electricity. Geothermal plant was shut down last year, hopefully it will reopen on schedule in 2020. In other areas concentrated solar should be in use. HI. had ONE trial concentrated solar plant, from what I have googled it never produced electricity for the general public, weird. instead HI is using https://recsolar.com/all-case-studies/waianae-solar/
                          huge PV plants, I thought Concentrated solar was more efficient? and one can store the extra energy in heat storage. of course much MUCH more expensive to get up and running and with a volcanoe potentially wiping it out easily, I guess that is why PV is more common.

                          Comment


                          • #14
                            Originally posted by Ampster View Post

                            Also to take the Federal Tax credit you have to charge your batteries from solar which means those kWhrs will not get credited at $0.35 per kWhr. The best you could due is offset loads at $0.35 per kWhr less inverter/charger inefficiency and wear and tear on your batteries. That is negative arbitrage.


                            Sounds like the sales guy was dishonest then, cuz I asked him a direct question - " can I charge my batteries using solar only and then dump the power onto the grid during peak rate times for $.35?" and he said yes.

                            To flesh out my thoughts a little, I was thinking that in order to fully utilize the battery capacity, I would charge using solar during the day ( which, I believe, PG&E would want anyways to avoid the duck curve thing ) and then dump onto the grid during peak usage times (which, I believe, PG&E would want anyways to avoid starting up peaker plants ). Granted, I'm aware of the wear and tear on batteries, but to me, that's the point of the exercise - it either makes financial sense or it doesn't. So all that would be factored in - cycle life, install cost, replacement cost, etc. So the plan would be - 1) charge batteries during the day 2) dump onto the grid during peak hours to get the best payback and full utilization of your investment 3) buy back from PG&E what you have 4) batteries will be at 20%-30% capacity overnight (which kinda eliminates FLA ? 5) charge batteries during the day, repeat......

                            But from the way it sounds, which will be fine if the inverter is sophisticated enough, the better plan would be 1) charge during the day 2) set the inverter preference to use battery power rather than grid power during peak hours 3) excess power goes to the grid 4) buy what you gotta 5) batteries at 20-30% at night..

                            Sound about right ?

                            Of course, this assumes that batteries make sense financially. Which I think everyone here would agree, that it doesn't. If one wants to for other reasons - power outages, off grid living ( which I won't be doing ) etc, then that's another thing.

                            So for us personally, power outages would be the only consideration. And I've been toying with the idea of using my rv generator - a Champion 3400 watt inverter generator - to power the house. Basically, during prolonged outages, the generator would be hooked to the batteries to continually charge them and the house would run as usual. A/C would run and draw down the battery, and when it kicks off the battery would recover - all the other loads aren't much, typically 600-800 watts/hour until the a/c kicks on when I look at the hour by hour breakdown on the PG&E website for our house. 3400 may not be enough, but we'll see, especially once you factor in that the solar panels would be charging at some unknown and variable rate also. Might not even need to start the generator until late afternoon? Who knows....

                            Comment


                            • #15
                              Originally posted by Harok375 View Post



                              Sounds like the sales guy was dishonest then, cuz I asked him a direct question - " can I charge my batteries using solar only and then dump the power onto the grid during peak rate times for $.35?" and he said yes.

                              ...
                              Salesperson dishonest or just not complete?

                              Theoretically the answer is yes, but it is uneconomical and permission from the utility is not likely. There are many things about utility rates and rules that defy logic.
                              As to your question it depends on the rates and whether you can use the tax credit economically.

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