Battery StorageSolar

A Battery Backup Power Boom

By December 4, 2019 No Comments

Home battery systems have been a growing part of the solar industry for several years, but in recent months they’ve finally started to take off in a big way. The 34.8 MW of residential energy storage installed in the second quarter of this year alone surpassed the industry’s total installations for all of 2017, according to the latest data from Wood Mackenzie and the Energy Storage Association.

These installations are typically attached to home solar systems, and the leading markets cited by Wood Mackenzie are also major solar states, including California, Hawaii, Florida, New York, New Jersey, Nevada, and Texas. However, unlike solar, many homeowners aren’t necessarily considering buying a battery to save money; instead, a significant amount of customer interest is driven by a desire for backup power in an emergency.

Protecting Your Customers From Grid Outages

The growing need for backup power has been made dramatically clear by PG&E’s and other utilities’ recent pre-emptive power shutoffs for hundreds of thousands of customers in California due to wildfire risks. While wildfires are not a new phenomenon in California, pre-emptive shutoffs on this scale are unprecedented, and these events are expected to become more common as rising temperatures and longer droughts caused by climate change heighten fire risks. 

The risks to the grid posed by extreme weather events go beyond California’s record-breaking wildfires. Climate change also fuels more intense precipitation events, as experienced repeatedly by residents of Florida, Texas, and other Gulf Coast states in recent years. On the Atlantic coast, North Carolina homeowners have faced recent outages from record-setting storms, and the memory of weeks-long power outages from Hurricane Sandy are still on the minds of many New York and New Jersey residents.

Because of consumer concerns about fires, hurricanes, snow, or other risks to the grid, the ability of some battery installations to continue providing backup power in the event of a grid outage (known as “islanding” capability) has become a major selling point for many homeowners. Being able to charge phones, run refrigerators, and power important medical equipment can mean the difference between an outage being merely inconvenient or being costly—or even life-threatening.

That said, it’s important to note that, like solar installations, not all battery systems continue to operate when the grid goes down—they must be equipped with islanding capability. Also, for those systems that are islanded and able to operate independently during a blackout, the typical storage installation might not have sufficient capacity to back up a household’s entire electricity use on a typical day (unless the installation has two or more battery units, which is increasingly common). But having an honest conversation about what batteries can and can’t do, and how to design systems to ensure that they power a homeowner’s most critical loads, is an opportunity to build the kind of trust-based rapport that can help close deals and earn referrals. 

By offering your customers backup power-capable battery storage in addition to solar, you can offer them a new and potentially very meaningful value proposition – and grow your business significantly.  

Rates, Incentives, and Financing Help Close Deals

Of course, dollars and cents still matter to your customers, even when making an important investment in their security in case of an emergency. And some states have utility rate structures that allow customers to earn more from their rooftop solar installations every single day if they are paired with battery storage. This can go a long way toward making storage a viable purchase, and is a big reason why California and Hawaii are the leading states for residential battery installations.

Government incentives can also bring down the upfront costs of adding storage. The federal solar investment tax credit (ITC), which is worth 30% of the cost of a solar installation through the end of 2019 (and 26% through 2020), may potentially be applied to the cost of batteries as well if they are installed at the same time. For California residents, the state’s Self-Generation Incentive Program (SGIP) offers rebates that can cover a substantial portion of battery costs, including additional rebates specifically for homeowners in wildfire-prone areas

Just like solar, however, the key to closing deals on battery storage systems is often the ability to offer financing that turns that upfront cost into long-term monthly payments. That’s why Mosaic has been offering our installer partners access to battery financing through our industry-leading solar platform since 2017. Our next-generation PowerSwitch 6 loan product is making it easier than ever to offer simple, combined solar-plus-storage financing with approvals on the spot, and our new battery-only loan lets you finance battery installations regardless of whether there is an existing Mosaic solar loan on the books. 

If you’re looking to add batteries to your solar company’s offerings, click here to learn more about PowerSwitch 6 and how to become a Mosaic partner.

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