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Batteries for New Home Electricity

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Did you hear the latest news about battery packs for home electricity coming from Tesla last week?  Last week Elon Musk, the main guy over at Tesla Motors, announced some new products that could eventually change the way we build homes, communities and power plants.  But can these new batteries really live up to the hype? 

Off Grid Living

One big dream for many of us is to live off the grid.  Meaning, we would like to build our dream home that doesn’t require connection to a utility company.  The only problem is that most green energy sources are intermittent.  The sun only shines during the day.  Windmills are only good when there’s…wind.  You get the idea. 

These new batteries for storing electric power opens up huge possibilities for constructing a home in areas that don’t have access to continuous utility power.  The announcement from Tesla this past week might help bring us closer to off-grid living in the near future. 

Backup Power

Another great use for this type of battery for home use is for backup power.  When the power goes out, homeowners are typically at the mercy of the power company.  But with a battery system in place, the power could go out for an entire city and the home could continue to function for a period of time off of the battery alone. 

This would be a better option than current gas powered backup generators in that they require less maintenance and are cheaper to operate.  The cost comparison between the two systems can be debated in either direction but it’s probably safe to say that neither option will be cheap for now.

Take Advantage of Off-Peak Electric Costs

Another advantage of battery storage units is the ability to store power in off peak hours that can be used during the peak energy use hours when utility rates are expensive.  Let’s take a look at California for example.  There is a nineteen cent difference in price from the lowest use period at night to the highest priced peak time during the day.  By using the lower priced power stored on the battery during the day, the homeowner can help reduce the draw from the power company during expensive periods effectively lowering overall utility costs to the household.

Net Metering

There are many homes in the U.S. that have photovoltaic power systems installed while also being connected to the power grid.  In many cases, the house sends excess power generated by the solar system back to the power grid and is paid by the utility company for the power.  This is called net metering.  The only problem is, most power companies pay wholesale rates for power purchased from the homeowner.  Here in Hawaii, this wholesale price is about half the price of the retail price charged.  So by adding battery systems to the home to capture the excess energy produced during the day, homeowners could conceivably save substantial amounts of money over the typical net metering agreement.

Costs for House Batteries

So what are the costs for these backup batteries that everyone is talking about?  Well according to Tesla, the batteries alone are estimated to cost as follows:  7 kWh = $3000, 10 kWh = $3500.   Keep in mind, there will also be costs for installation, control software and for the inverters.  So the installation of a 10 kWH system is estimated to be just over $7k. 

How Much Battery Does My Home Need?

So what size battery does the typical house need?  Well, as with everything else in the world, it depends on several factors.  The 10 kWh battery supposedly has a continuous output of 2 kW.  We are told that a medium sized home could be run off the battery (without air conditioning which draws 4-5 kW) for approximately three to four hours.    So why doesn’t the math add up?  The battery and inverter are less than 100 percent efficient.  So a 10 kWh battery doesn’t produce a full 10 kWh after considering some of the losses in the system. 

Looking at a utility bill for my own home I see that we use about fourteen kWh per day.  So if we are looking to store enough power to cover most of a day, we would probably want to go with two 10 kWh batteries.  But would we really need power for a whole day?  Probably not since we are connected to the grid.  Power outages are typically resolved in no more than a couple hours and most of the time in minutes.  But for those living off the grid, more battery capacity will be needed to compensate for days where the sun or wind aren’t producing enough.

Michael Luckado

Michael Luckado has built, remodeled, and repaired thousands of homes across the U.S. He co-founded to help people save money and time creating their dream home.

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