The rise of storage systems paired with PV bucks an overall trend that new solar installations for German households are falling. Image: ASD Sonnenspeicher.
One analyst has predicted that 12,500 residential PV storage systems could be installed in Germany in 2015, more than the total number of systems installed with support from a government scheme in its first two years.
This month marks the second anniversary of the introduction of Germany’s financial support measures for battery-based energy storage systems. These include a federal ministry of economics and technology (BMWi) grant of around €600 per kilowatt of PV installed for new projects, or slightly more in the case of retrofitting battery storage to an existing PV installation. The remainder of the support comes in the form of low cost loans from Germany’s development bank, KfW.
KfW announced this week that in the two years since the scheme was launched in May 2013, it has given out loans for the installation of just over 10,000 systems. This was done at a cost of about €163 million, the bank said. This compares favourably with the first year of the scheme, during which about 4,000 systems were installed.
Markus Hoehner, head of EUPD Research, welcomed the news and told PV Tech Storage that his firm expected the growth to continue on an upward trend. Hoehner said the figures given by KfW tallied with EUPD’s findings. EUPD tracked the market and believed 8,300 systems had been installed by the end of last year, meaning the first quarter of this year has already seen comparatively strong sales.
“For 2015 we estimate 12,500 new systems will be installed – with and without KfW support,” Hoehner said.
“The average system size varies between 5.1kWh for lithium-ion and 6 kWh for lead acid.”
However, the vast majority, 75%, are expected to be lithium-ion based, Hoehner said, quoting average system prices of around €2,000 per kWh for lithium-ion and €1,400 per kWh for lead acid. Hoehner also predicted that the lead up to June’s Intersolar trade exhibition and conference in Munich might see manufacturers lowering their prices to boost competitiveness.
Overall therefore, Hoehner said: “We estimate the total market volume at around €158 million, taking installation and margin into account, which make up 30% of the system costs.”
Sam Wilkinson at another research firm, IHS, pointed out also that the KfW figures do not sum up the entire market volume. According to Wilkinson, in addition to the development bank-backed installations there have also been a handful of early adopters. There are also certain restrictions, such as eligible battery type and warranty length, which meant some prospective battery owners opted out of the scheme or were unable to benefit. There could be as many as 5,000 to 10,000 of these household PV storage system owners in Germany that installed batteries without KfW assistance, Wilkinson said. IHS recently predicted that worldwide, the residential storage market will increase tenfold in size by 2018.
The head of a German lithium iron phosphate storage maker, ASD Sonnenspeicher, Wolfram Walter, told PV Tech Storage in the early days of the subsidies that the scheme had been a little too complicated for the majority of his customers to go for, with many opting not to bother. This appears to have changed somewhat in the interim, if the latest figures are anything to go by.
Indeed, the rise of storage systems paired with PV bucks an overall trend that new solar installations for German households are falling. Several sources have pointed out that while the residential sector for rooftop PV has cooled, the proportion of PV systems being installed with energy storage attached has increased. As IHS analysis pointed out from 2014’s figures, this is due in part to self-consumption being the most economically attractive model for household PV owners as feed-in tariffs (FiTs) drop away, as well as a fall in system prices.
Meanwhile, German solar trade industry body BSW Solar also welcomed KfW’s reported figures. The association said strong demand was fuelled by the support scheme and falling prices, stating that it believed system prices have on average fallen by a quarter in the past year. BSW Solar noted too, that automotive manufacturers are increasingly becoming interested in this space.
BSW Solar also quoted a study commissioned by the German renewable energy association, BEE, which said the benefits to the network of energy storage in integrating renewables and balancing the grid, had not yet been explored to its full potential.