German PV module and storage manufacturer Solarwatt recently announced its intention to expand into the UK market with the launch of its MyReserve storage system. The company has already built a strong presence in Central European markets like Germany and the Netherlands, with its move on the UK residential sector coming at the same time the firm is preparing to roll out in France and Spain.
Energy Storage News caught up with Pol Spronck, Solarwatt’s international sales manager, to discuss the latest expansion and with the company is hoping to bring to the UK.
What do you hope to achieve with Solarwatt’s expansion in the UK?
The entire vision we have is adding storage systems to solar panels and to have a complete energy management system for residential households and that's eventually where we're going to go. For people to have their entire energy consumption that they can monitor and manage with their battery storage and PV with electrical vehicle charging, heat pumps. They can connect everything to this system which is already available in Germany and is going very well.
That is eventually what we want to offer in other countries but that takes time and we need to take one step at a time, first the modules then the storage.
In Germany Solarwatt work in partnership with EON to offer the entire Solarwatt package including an intelligent energy management system. What are the advantages of working with utilities and will you continue this partnership in other markets like the UK?
That's definitely possible, there is interest shown by utilities here as well. We're talking to them in the Netherlands and in Spain. Striking deals like that is very good as you can ramp up production and if you have a contract like this you can have a deal for around 20,000 units so we are sure we are going to sell that and you can plan the production the expansion of the factory better if you have a sales forecast.
For the MyReserve last year there was a pre-ordering phase before we launched and there was around 1,000 systems ordered (in Germany). That made it clear to our owner Stefan Quandt because money talks so if you can show that you have this amount of orders already in your order book it makes it easier to get investments. For the UK, if you have a couple of deals like this lined up there will also be a higher priority in the expansion towards UK.
How quickly are you looking to ramp up your presence in what is currently a fairly small market with significant potential?
At the moment we sell a lot of modules and inverters. Before we enter the market very strongly with MyReserve we need to have a full service organisation and some pilot installations that we are going to run. There is a lot of interest so we need to select four or five parties that we can trust that can test it and also monitor the system to see how it goes. We'll then introduce the MyReserve solution fully into the UK market and by Q4, maybe the beginning of 2017.
We will be able to do it in larger volumes because we have acquired the factory that has developed and produces the batteries - a German company called e-Wolf (purchased in April 2016) who also developed the batteries for Formula E cars. These are batteries that need to respond very quickly to energy demands from the engine and we co-developed our batteries with this company and we acquired that entire factory with all the intellectual property, patents and 18 very knowledgeable engineers to develop the systems and the building.
We called it SOLARWATT Innovations and it's now our technology centre and with this acquisition we have a very favourable position to fast track new developments in the battery systems. We now have the most efficient, safest and cost-efficient battery today but the costs for batteries have to come down in the next few years.
We think by 2020 they will drop by 40% by economies of scale and market drivers, it will not be the past way to have subventions for it. It needs to be a development from the market to bring down costs.
Do you see the price of battery storage as it stands now to be a barrier to larger deployment?
I think so, as we saw in solar energy. But now solar energy is basically at parity with conventional energy and at that point we've seen in different markets you don't need subsidies to make it interesting, it's already interesting by itself.
If you look at the payback time of the complete system with our modules, which are at a premium price because they also have a 30 year performance warranty, it's a high end generation module and with the MyReserve, the payback time is around 11 years. This is the business case in Germany, we still need to crunch the numbers for the UK and that's part of reason for the pilot installations, to take real figures to make that calculation.
What makes the system a high end product to reflect that cost and payback period?
The system is DC coupled with the energy stored on 44v, that's one of the reasons why it is the most efficient system with peak efficiency of 96%. There are also very good AC systems but with the cell technology that we have and the way it's built up it's just the most efficient system there is and what that means is what you produce on your roof, most of it will be consumed within the household.
That is what we want to achieve, to increase the percentage of your own power that you generate with your solar panels, to use it all within your house and there's a lot of features within this battery that make it possible to do this.
The response time of the battery is very fast. If you for example wanted to make a cup of coffee at home and you turned on the coffee machine there is a peak demand at that moment and if you're battery doesn't respond fast enough it will basically miss the peak. It will supply the peak but a few seconds later, the result being that the peak will be supplied by the grid and the energy supplied by your battery will be fed back into the grid. So you don't really use the battery and that is something that all the features in this battery do to increase the self-sufficiency.
Considering the changes in government support for the UK renewables market, are you still confident that there is a market that you can come into?
There is always a market for people that are looking for quality. There is not always a market for people that want the cheapest because if they cannot get the cheapest they will not go for it. For people that want quality that really want to generate their own electricity they will go for the best quality and it's the higher segment but there will always be a market for that and in the UK it's a very favourable condition for that.