Tesla’s Powerwall Battery Bank Will Change the Politics of Solar Panel Incentives

Imagine a home that was completely self-sufficient. It produced its own electricity and could heat and cool itself completely with renewable energy without ever being connected to the grid or resupplied with fuel. Imagine how this technology would change current incentives and policies on alternative energy sources like solar and wind.  Believe it or not, the technology exists to do exactly this and it costs a whole lot less than you may think.

Testla's Powerwall battery bank will revolution the solar panel industry.

Tesla’s Powerwall battery bank will revolutionize the solar panel industry and change the politics around alternative energy power sources.

Over the last 8 years I’ve written at great length on the benefits of solar power, geothermal heat-pumps and maximizing your home’s energy efficiency. The one missing link that prevented homes from being completely off the grid and self-sustaining (without giving up modern conveniences) was reliable power storage.  Power storage, in the way of battery banks or capacitors, would enable homes to power themselves when there was no sunlight or wind.

One of the biggest complaints opponents of solar panel incentives have made over the years is that solar panels are only viable during the day time when the sun is shining bright. Solar owners are credited, through a provision called Net Metering (or Net Energy Billing), for excess energy that they send back to the power grid.  These credits can then be used to buy back power at night or during days when the sun isn’t shining.

Opponents of Net Metering ask why tax payers should help subsidize the purchase and installation of residential solar panels if these homes still have the privilege of being connected to the regular electricity grid (a privilege most solar owner don’t pay for). They question whether or not the prospect of green energy and reduced greenhouse gas emissions is worth the extra cost?

For example, a bill vetoed by Maine Governor Paul LePage earlier this year, would have required the state to enter into long term contracts (15 to 20 year terms) with residential solar panel owners to buy the excess power they generate at artificially high prices.  The bill operates on the premise that solar panels are currently too costly for people to benefit (which is wrong) and that solar prices will not become even more affordable in the next 5-7 years (which is also wrong).  Had the bill gone through, Maine rate payers would have been on the hook for excessively priced solar power for decades while the actual costs of solar power continues to drop.

With the unveiling of Tesla’s new Powerwall battery bank, it is foreseeable that some homes will not even need to be connected to the grid.  In this scenario, traditional electrical utility companies may find themselves going the way of landline telephone companies serving only a percentage of the homes they once did.  It may be the utility companies the government will end up having to support. While this scenario may seem far-fetched, it will happen, and it will happen a lot sooner than many people realize.

Components of a Self-sustaining Energy Efficient Home Currently at $50,000:

Let’s take a closer look at the cost associated with each component of a self-energized home:

Solar Panels: Photovoltaic solar panels have decreased in price significantly over the last 7 years. Today, you can purchase a solar panel array capable of producing more than enough electricity for about $15,000 to $17,000 installed. Even less when you consider tax credits.

Geothermal Heat Pumps: Most residential solar panel systems are not capable of producing enough energy to either heat or cool your home. Geothermal heat pumps can fill this gap by circulating water through a series of pipes buried underground to provide heating or cooling

The ground beneath your home typically stays at a constant temperature of around 58 to 62 degrees (depending on region). In the winter time a heat pump can heat your home by forcing water through the buried pipes and then extracting the heat out of the water via a heat exchanger. In the summer time, a heat pump can cool your home by running the system in reverse taking the hot temperature out of your home and putting it back in to the ground.  An average sized geothermal heat pump can be installed at your home for around $20,000 to $25,000.

Tesla Powerwall (or similar) Battery Bank: The Tesla Powerwall battery bank will be able to capture excess power generated by your solar panel system during the day where it can be used at night and during periods of inclement weather when the sun isn’t shining. Powerwall units are discrete and relatively inexpensive.  Two Powerwall units are more than able to power a 4 bedroom home at a cost of about $12,000 installed.

Energy Efficient Home: Another component of the so called “Eco-Home” is making sure the home is as energy efficient as possible. If you’re building a new home, you might want to consider Insulated Concrete Form (ICF) construction. If you’re upgrading an existing home, you might be interested in my article on 36 ways to reduce your home’s energy use or my DIY home energy audit.

It will be interesting to see how the Trump Administration, and state and local governments tackle the alternative energy policies in the years to come.  It’s plausible that Tesla’s Powerwall battery units (as well as their competitors) will completely upend the argument about Net Metering and other solar panel incentives that currently complicated the growth of the solar panel industry.  It won’t be long before solar panel technology will sell on its own merits without the needs for costly incentives.

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