Home Batteries Offtake In Australia Offers Pointers To the Future For Rooftop Solar In India

Australia, with its abundant sunshine and widely spread out consumer base has always been an obvious case for solar plus storage. Thus, while solar took off as soon as prices came to a level that could work in that market, turning it into the world's highest market by solar rooftop penetration by 2024, storage has been on a similar journey ever since prices dropped below key barriers. The federal government too has shifted subsidies from solar to storage, as it seeks to encourage the latter to balamce out the tremendous success it has had with solar rooftops. Presently, the country regularly has excess solar in the daytime hours, which need an outlet like storage to avoid wastage as well as provide power in the evening hours.

Now Playing-The Battery Boom

Australia's key energy authority has predicted that total home battery installs will cross 100,000 this month, aggregating to total storage capacity of over 2000 MWh at household level. This has come even as installs are constrained by availability of both batteries and more so, the manpower required to install. That is what has limited fresh additions to 1500 per week, and waiting times that are over 3 months long. 

Lower costs, and the gradual addition of EVs by many owners, has also meant that the typical storage capacity has moved from a typical 4 kWh system back in 2015 to an average of 25 kWh for the systems being installed now, a function both of dropping costs and rising power demands due to EVs. In fact, many customers are opting for EVs to better utilise their excess power generation during daylight hours! 

The Australian market itself has been well covered for the multiple 'large' or "big batteries' that have been coming up or due to come up in the next few months to further ease the pressure from the huge rooftop solar generation that has started generating as much as 100% of total power requirements during daytime hours. 

It is a somewhat similar story in California, US,  where BESS storage  has gone from 0.5 GW in 2018 to  over 15 GW now. With another 8.7 GW due to be added by 2027, the state energy commission wants much more to be added on by 2045 to meet its goals of carbon free emissions for the grid. More importantly, the lower priced storage being added might finally give the state a break from high power costs after some time,  as they meet more and more of evening peak demand. With battery life expected to be as high as 25 years soon, that makes the state target more than achievable without any major push, and perhaps, despite the antagonism of the Trump administration to green energy. 

Other markets like the Middle East, especially UAE and Saudi Arabia have seen a notable push for storage as well. 

The India Market 

So what does all this mean for the Indian market?  For one , the market has already started shifting rooftop solar to hybrid mode, with small storage systens complimenting rooftop solar.  While neither average demand or purchasing power matches Australian levels, it should be no surprise if storage batteries trend towards 10 kWh , rather than the nominal 1-3 kWh that are being pushed right now as a 'backup'.  For those who can afford it, larger batteries linked to a solar system of over 5kWh size, will create the same conditions to charge EVs at home for a much lower cost, besides possibly reducing the imbalance in the Indian grid during solar hours that is building up currently. Add to that the many 'big batteries' we will see starting 2026, and we seem well on our way. Of course, with a much higher grid size and total demand profile in India, actual situations that would mirror the Australian  market today might develop only by 2029-30, when total solar capacity goes past 250 GW, from the current 130 GW odd.

Monopoly Discoms and Regulatory Capture

Seeing how changes in the Indian market have trailed developed markets like Australia or China by about 2 years typically, it might be instructive to see where the Australian markets are struggling even now.  A clear area has been Virtual Power Plants. Joining a VPP is an option that consumers haven't jumped at in Australia, due to multiple factors. While discoms or distribution utilities would like nothing more, less than 5% of solar and storage rooftoop owners  have apparently opted for one. This is linked to what they find to be poor payouts offered, issues linked to trust, unfamiliarity with the option, and worries on the wear and tear on their storage systems. So far, utlities have done a poor job of selling the idea, which should in principle, help users recover their investment costs even faster. For India, while some time away from a similar need, there is every chance that discoms will seek to make it mandatory for future systems, rather than make the effort to sell the concept. This, and other grid balancing requirements like grid forming inverters are already seeing early regulatory moves to take the decision out of the consumers hands. With less than 15% of targets achieved under the key PM SUryaghar Rooftop Solar scheme, there is enough time and leeway left for policy makers to make the changes at the right time.       

Conclusion

While the move to solar rooftops is afoot, many states might do well to redirect their own extra subsidies towards battery storage with conditions linked to it like joining VPPs.  These allow the discom to take control of the battery when they need to, to balance the grid and demand curve. We have seen states like Kerala become alive to the situation, with the proposed storage mandate of at least 10% of solar capacity for sytems over 5kW. That move remains too timid, perhaps because Kerala is the first state to have made the proposed move. Storage mandates will need to go up, along with higher support to drive the shift. By now, many customers are already aware that normal grid-tied inverters and solar sytems will not generate power when the grid is down. That has started a small push for hybrid inverters, that can store the energy generated. As the grid becomes a genuine 24x7 availability grid, the value of higher storage will become more apparent to the higher value consumers with EVs for instance. Of course, their joining VPPs will also lessen the burden on consumers who cannot install solar power, by forcing down overall costs as well, something that will become more and more relevant as the share of rooftop solar rises.