AGL Energy Ltd. plans to announce a program within a few months to roll out about 1,000 energy storage systems for Australian homes with rooftop solar panels amid forecasts that falling prices will stimulate demand.
While demand for battery technology in Australia has been “very low,” it’s expected to pick up with costs projected to decline about 60 percent in the next five years, said Andy Vesey, AGL’s chief executive officer. The electricity retailer formed a partnership earlier this year with California-based storage developer Sunverge Energy Inc.
“You’re going to start to see very significant uptake at the consumer level,” Vesey said Tuesday after addressing a business lunch in Sydney. “There’s tremendous opportunity to improve the performance and the costs.”
AGL in February unveiled a $20 million investment in Sunverge, a provider of energy storage and management systems, as part of its effort to accelerate the introduction of the technology. Tesla Motors Inc., LG Chem Ltd. and Panasonic Corp. are among companies jumping into an Australian storage market that Morgan Stanley estimated could be worth A$24 billion ($17 billion) after a surge in solar installations.
Australia was leading the world in installing solar panels on the roofs of homes, according to a report last year by the Melbourne-based Grattan Institute. About 30,000 Australian homes will have PV-energy storage systems by 2018, Marianne Boust, a Paris-based analyst at IHS Inc., wrote in a report in February. The country had less than 500 installations at the end of 2015.
SA Power Networks said last week it will deploy about 100 Tesla and Samsung batteries in tests due to start in June. Rather than building a new power line to meet demand, the South Australian company wants to tap local solar generation and combine it with storage.
“We’re also looking at a similar, much larger program that we’ll announce relatively soon, which will be 1,000 residential batteries, all at a discounted way of getting that to the consumer, because right now nobody can afford it,” Vesey said.
The biggest retailers in Australia are offering solar and storage packages ranging from A$14,990 ($10,800) to A$24,990, according to Annabel Wilton, a Sydney-based analyst at Bloomberg New Energy Finance.
The AGL battery program would be the equivalent of building a 5-MW solar plant, Vesey said. With Sunverge’s energy-management technology, “we can operate it as if it was one plant, a virtual power plant,” he said.
© 2016 Bloomberg